By Gerald L. Maatman, Jr.

Our loyal blog readers know that the start of the year is the launch date of Seyfarth’s Annual Workplace Class Action Litigation Report.

And here it is – our 10th Annual Report: click here to download a PDF of the introduction “trends” chapter and the “top ten” settlements chapter.

Called the “definitive source of information on employment class action litigation” by EPLiC Magazine and a resource that “no practitioner who deals with employment claims . . . should be without,” the 802 page Report covers 1,123 class action rulings rendered by federal and state courts in 2013 on workplace issues. To order your copy of the 2014 Report, please click here and complete an order form. Its FREE, and this year it is available again in eBook format.

Themes Of 2013 In The Workplace Class Action World

Workplace class action litigation is in a state of flux. The events of the past year in the workplace class action world demonstrate that the array of bet-the-company litigation issues that businesses face are evolving on a landscape that is continuing to undergo significant change. At the same time, governmental enforcement litigation remains “white hot” and regulatory oversight of workplace issues continues to be a priority, thereby challenging businesses to integrate their litigation and risk mitigation strategies to navigate these exposures.

By almost any measure, 2013 was a year of evolving changes for workplace class action litigation.  The U.S. Supreme Court issued several class action rulings in 2013 – in Comcast Corp. v. Behrend, 133 S. Ct. 1426 (2013), American Express Co. v. Italian Restaurant, 133 S. Ct. 2304 (2013), and Standard Fire Insurance Co. v. Knowles, 133 S. Ct. 1345 (2013) – that impacted all varieties of complex litigation in a profound manner this past year.

More than any other development in 2013, the decision in Wal-Mart Stores, Inc. v. Dukes, 131 S. Ct. 2541 (2011), continued to have a wide-ranging impact on virtually all types of class actions pending in both federal and state courts throughout the country. In many respects, Wal-Mart was the “800 pound gorilla” in courtrooms in 2013 as litigants argued and judges analyzed class certification issues. Rule 23 decisions in 2013 in large part pivoted off of Wal-Mart, and leverage points in class action litigation increased or decreased depending on the manner in which judges interpreted and applied Wal-Mart. Furthermore, Comcast Corp. fueled defense arguments by undermining attacks on class certification in a wide range of contexts, which were met with mixed success for employers.

Against this backdrop, the plaintiffs’ class action employment bar filed and prosecuted significant class action and collective action lawsuits against employers in 2013.  In turn, employers litigated an increasing number of novel defenses to these class action theories, fueled, in part, by the new standards enunciated in Wal-Mart and Comcast Corp. 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 “Wal-Mart issues” and “Comcast Corp. issues” were at the forefront of these case law developments.

Key Trends In 2013

An overview of workplace class action developments in 2013 reveals seven key trends.

1.         The Supreme Court’s opinions in Wal-Mart and Comcast Corp. had a profound influence in shaping the course of class action litigation rulings throughout 2013.  Wal-Mart and Comcast Corp. prompted defendants to mount challenges to class certification based on all sorts of theories. This resulted in new types of case law rulings on a myriad of Rule 23-related issues.  The result was a year of decisions on class action issues the likes of which have never been seen before.  As many class action issues are in a state of flux post-Wal-Mart and post-Comcast Corp., these evolving precedents are expected to continue to develop in the coming year.

2.         Government enforcement litigation in 2013 increased over levels in 2012. As an inevitable by-product of the economy’s unemployment rates, more discrimination charges were filed with the EEOC in 2013 than in all but three previous years since the founding of the Commission in 1964. The EEOC’s systemic investigation program expanded yet again over prior years. This development is of critical importance to employers, for it evidences an agency with a laser-focus on high-impact, big stakes litigation.

3.         Wal-Mart and Comcast Corp. influenced settlement strategies in workplace class actions in a profound way.  Employers settled fewer employment discrimination class actions than at any time over the past decade and at a fraction of the levels as in 2006 to 2012. Wal-Mart and Comcast Corp. aided employers to defeat, fracture, and/or devalue employment discrimination class actions, and resulted in fewer settlements at lower amounts.

4.         The continued dislocations in the economy during 2013 fueled more class action and collective action litigation over wage & hour laws.  In particular, the plaintiffs’ class action bar eclipsed the pace of filings of FLSA collective actions and wage & hour class actions as compared to previous years.  Furthermore, these conditions spawned more employment-related case filings, both by laid-off workers and government enforcement attorneys.  Even more wage & hour and EEOC litigation is expected in 2014. 

5.         Case law developments under the Class Action Fairness Act of 2005 (“CAFA”) continued to mature and the U.S. Supreme Court decided its first case under the CAFA in 2013 in Standard Fire Insurance Co. v. Knowles.  It rejected the increasingly frequent tactic of the plaintiffs’ bar to stipulate to damages of less than $5 million, the CAFA’s amount-in-controversy requirement, in an effort to prevent removal of class actions from state court to federal court. 

6.         The Supreme Court’s ruling in 2013 on class arbitration issues in American Express Co. v. Italian Restaurant (“AMEX”) informed the ever-growing body of case law that allows employers to utilize carefully crafted workplace arbitration agreements to manage their class action litigation risks.  Corporate counsel are expected to give workplace arbitration a thorough evaluation in the post-AMEX world.

7.         The plaintiffs’ class action bar is a tight-knit community, and developments in Rule 23 and § 216(b) case law in 2013 saw rapid strategic changes based on evolving decisions and developments.  In reaction to the Supreme Court’s rulings in Wal-Mart and Comcast Corp., the plaintiffs’ class action bar continued the process of “re-booting” class-wide theories of certification, as well as new methods for establishing liability and damages on a class-wide basis.  As a result, new certification approaches and cutting-edge strategies are rapidly evolving throughout the substantive areas encompassed by workplace class action law.  As a result, workplace class action case law is in flux, and more change is inevitable in 2014.

We hope you enjoy the 2014 Report!