2012CAR_small.jpgBy Gerald L. Maatman, Jr.

Today we are launching Seyfarth Shaw’s 8th Annual Workplace Class Action Litigation Report to the loyal readers of our blog.

The 2012 Report is our biggest ever. It contains analyses of 976 class action rulings on a circuit-by-circuit and state-by-state basis. The Report is divided into chapters on leading class action settlements (both from a monetary and injunctive relief standpoint), federal law rulings, and state law rulings. The substantive areas examined include Title VII, EEOC pattern or practice cases, the Age Discrimination in Employment Act, the Fair Labor Standards Act, the Employee Retirement Income Security Act, state law rulings in employment law, wage & hour, and breach of contract cases, key CAFA rulings, and other class action rulings with significance to employers on Rule 23 and/or workplace litigation issues.

The Report is the sole compendium in the U.S. dedicated exclusively to workplace class action litigation. Called “the definitive source on employment class action litigation” (EPLiC Magazine, Spring 2011), it has become the “go to” research and resource guide for businesses and corporate counsel facing complex litigation. The Report is fully searchable, and is a great tool for corporate law departments in dealing with complex litigation issues in all sorts of substantive legal areas.

The 2012 Report is 790 pages. To obtain your copy, a convenient order form is attached here.

The Introduction Chapter on significant workplace class action trends over the past year can be downloaded here.

2011 Was A Landmark Year In Workplace Class Actions

As events of the past year in the workplace class action world have demonstrated, the array of bet-the-company litigation issues that businesses face continued to evolve on a landscape that is undergoing significant change. In turn, governmental enforcement litigation and regulatory oversight of workplace issues heated up to new levels, thereby challenging businesses to integrate their litigation and risk mitigation strategies to navigate these exposures.

supreme-court-seal.pngBy almost any measure, 2011 was a transformative year for workplace class actions. The U.S. Supreme Court issued three class action rulings – in Wal-Mart Stores, Inc. v. Dukes, et al., AT&T Mobility v. Concepcion, et al., and Smith, et al. v. Bayer – that impact all varieties of complex litigation in a profound manner. The Supreme Court’s decisions are also apt to have far-reaching implications for litigants for years to come.

More than any other development in 2011, Dukes had an immediate and substantial ripple effect on virtually all types of class actions pending in both federal and state courts throughout the county. It fostered a cascading waive of decisions in the second half of 2011, as litigants and courts grappled with the ruling’s implications in a wide variety of class action litigation contexts. As of the close of the year, Dukes had been cited a total of 260 times in subsequent case rulings, a remarkable figure for a decision rendered in June of 2011.

Against this backdrop, the plaintiffs’ class action employment bar filed and prosecuted significant class action and collective action lawsuits against employers in 2011. In turn, employers litigated an increasing number of novel defenses to these class action theories, fueled in part by the new standards enunciated in Dukes and Concepcion. As the Report reflects, federal and state courts addressed a myriad of new theories and defenses in ruling on class action and collective action litigation issues. The impact and meaning of “Dukes issues” and “Concepcion issues” were at the forefront of these case law developments.

The Key Trends Of 2011 

An overview of workplace class action developments in 2011 reveals six key trends. 

First, the Supreme Court’s opinions in Dukes and Concepcion had a profound influence in shaping the course of class action litigation rulings throughout 2011. Dukes caused both federal and state courts to conduct a wholesale review of the propriety of previous class certification orders in pending cases, prompted defendants to file new rounds of motions based on Dukes to attack all sorts of class theories (and not just those modeled after the nationwide class claims rejected in Dukes), and reverberated in case law rulings on a myriad of Rule 23-related issues. Concepcion likewise fueled significant litigation over the impact of workplace arbitration agreements and the impediments such agreements may impose on employment discrimination class actions and wage & hour collective actions. The result was a year of decisions on class action issues the likes of which have never been seen before. This wave of new case law is still in its infancy. As many class action issues are in a state of flux post-Dukes and post-Concepcion, these evolving precedents are expected to continue developing in the coming year.

seal.pngSecond, government enforcement litigation reached “white hot” levels in 2011. This was especially evident in terms of the enforcement litigation program of the U.S. Equal Employment Opportunity Commission. As an inevitable by-product of our nation’s economic woes, more discrimination charges were filed with the EEOC in 2011 than in any previous year since the founding of the Commission in 1964 – a new record high of 99,947 discrimination charges against private sector employers (by comparison, the EEOC last year reported receiving a then record high of 99,922 discrimination charges). The Obama Administration’s emphasis on administrative enforcement also spawned more government-initiated litigation over workplace issues. The EEOC’s systemic program – in which the Commission emphasizes the identification, investigation, and litigation of discrimination claims affecting large groups of “alleged victims” – grew to its largest level ever. This development is of significant importance to employers, for it evidences an agency with a laser-focus on high-impact litigation.

Third, the continued dislocations in the economy during 2011 fueled more class action and collective action litigation. In particular, the plaintiffs’ bar continued the pace of filings of FLSA collective actions and ERISA class actions seeking recovery for unpaid wages and 401(k) losses. Furthermore, these conditions spawned more employment-related case filings, both by laid-off workers and government enforcement attorneys. As of the close of the year, filings held steady in these distinct categories and increased across the board in employment discrimination, wage & hour, and ERISA cases. In turn, this resulted in more judicial rulings (especially in FLSA collective action cases), as well as higher settlement numbers (especially in government-initiated enforcement lawsuits and ERISA class action litigation). Even more workplace litigation is expected in 2012, as businesses re-tool their operations and the dust continues to settle.

scalesofjustice-thumb-150x143-6140.jpgFourth, wage & hour litigation continued to out-pace all other types of workplace class actions. This trend was manifested by the fact that in terms of case filings, collective actions pursued in federal court under the FLSA outnumbered all other types of private class actions in employment-related cases. In addition, Rule 23 and § 216(b) decisions by federal and state court judges on wage & hour issues were greater than in any other area of workplace litigation – more than triple that for employment discrimination or ERISA class actions combined. Significant growth in wage & hour litigation also was centered at the state court level, and especially in California, Illinois, New Jersey, New York, Massachusetts, Minnesota, Pennsylvania, and Washington. The crest of the wave of wage & hour litigation is not yet in sight, and this trend is likely to continue in 2012.

Fifth, the plaintiffs’ class action bar is a tight-knit community, and developments in Rule 23 and § 216(b) case law in 2011 saw rapid strategic changes based on evolving decisions and developments. This fostered quick evolution in case theories, which in turn impacted defense litigation strategies. With the Supreme Court’s rulings in Dukes and Concepcion, the plaintiffs’ class action bar has begun a process of “re-booting” class-wide theories of liability and certification. As a result, new certification approaches and cutting-edge strategies are spreading rapidly throughout the substantive areas encompassed by workplace class action law. More than any other trend, the on-going changes to strategy considerations in crafting class claims and litigating Rule 23 certification motions in the wake of Dukes drove case law developments in the second half of 2011. As a result, workplace class action case law is in flux, and more change is inevitable in 2012.

Map-thumb-150x96-6141.jpgSixth and finally, the financial stakes in workplace class action litigation increased in 2011, but in a manner far different than past years. The plaintiffs’ bar continued to push the envelope in crafting damages theories to expand the size of classes and the scope of recoveries. These strategies resulted in a series of massive settlements in nationwide ERISA class actions, as well as in government enforcement prosecutions at levels above the aggregate settlement totals in 2010. At the same time, settlements of employment discrimination class actions were less frequent and decidedly smaller than in past years. This reflected the impact of Dukes, and the notion that difficulties in certifying nationwide, massive class actions place restrictions on the ability of the plaintiffs’ bar to convert their case filings into settlements; it also manifests the ability of defendants to dismantle large class cases, or to devalue them for settlement purposes. As the “shake-out” period of litigating in the post-Dukes world continues to play out in 2012, the plaintiffs’ bar undoubtedly will continue in their search for a successful blueprint for certifying large employment discrimination class actions that enhance their ability to convert the class filings into substantial settlements.

More To Come 

Some of our subsequent postings will cover our picks for the “top ten” 2011 rulings and the “most intriguing decisions” of the year. We also will announce our annual class action webinar date soon.

We hope you enjoy the Report!