Billinglsley v. Citi Trends, Inc.
560 F. App'x 914
11th Cir.2014Background
- Billingsley (a Citi Trends store manager) filed a putative FLSA collective action alleging store managers were misclassified as exempt and denied overtime; she sought court-supervised notice to similarly situated managers.
- After the court set a schedule for conditional certification, Citi Trends held mandatory, one-on-one "back-room" meetings with store managers and obtained signed arbitration agreements and fill-in declarations from many potential opt-in plaintiffs.
- Meetings were conducted by HR representatives (with a second unidentified witness), were presented as handbook rollouts, and were characterized by managers as coercive and threatening to employment, producing a record of intimidation and lack of meaningful choice.
- The district court conditionally certified the collective action, found Citi Trends’ ADR rollout was designed to curtail litigation, held evidentiary hearings, and concluded the arbitration agreements were procured under coercive conditions.
- The district court denied Citi Trends’s motion to compel arbitration (on managerial-authority and unconscionability grounds) and ordered notice advising potential opt-ins they could join despite having signed arbitration agreements; Citi Trends appealed.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether the district court could prevent enforcement of arbitration agreements obtained by the employer during pre-certification communications with putative FLSA opt-ins | Billingsley: district court may protect collective notice process and allow opt-ins who signed under coercion to join | Citi Trends: arbitration agreements are enforceable; employer may require arbitration of employee claims | Court: district court did not abuse discretion in refusing to enforce agreements procured through misleading, coercive pre-certification conduct; denial of motion to compel affirmed |
| Whether district court’s managerial authority under FLSA and procedural rules permits corrective relief for improper pre-certification communications | Billingsley: court has broad authority to manage joinder and prevent prejudicial ex parte communications | Citi Trends: employer’s conduct did not strip arbitration agreements of enforceability; court exceeded authority | Court: Hoffmann–La Roche and Gulf Oil principles support broad managerial power; corrective, limited relief was appropriate |
| Whether arbitration agreements were unconscionable / procedurally invalid due to coercion | Billingsley: agreements were signed under duress and thus unenforceable | Citi Trends: signatures valid; agreements should be enforced against signees | Court: district court found coercion and procedural unfairness supporting non-enforcement (alternative basis), but affirmed primarily on managerial-authority ground |
| Scope of remedial order — whether limited to this case or a broader invalidation of agreements | Billingsley: relief should protect opt-ins in this case from coercive waiver | Citi Trends: relief improperly interferes with contractual rights beyond case | Court: remedial order was narrow and limited to this FLSA action and to agreements procured by the specific coercive rollout; district court did not overreach |
Key Cases Cited
- Hipp v. Liberty Nat’l Life Ins. Co., 252 F.3d 1208 (11th Cir.) (describes two-step conditional certification/notice framework for §216(b) collective actions)
- Hoffmann–La Roche Inc. v. Sperling, 493 U.S. 165 (Supreme Court) (district courts have broad authority to supervise notice and manage collective actions)
- Gulf Oil Co. v. Bernard, 452 U.S. 89 (Supreme Court) (class/collective actions require court management to prevent abuse)
- Kleiner v. First Nat’l Bank of Atlanta, 751 F.2d 1193 (11th Cir.) (district court authority to police communications with class/collective members)
- Roland Elec. Co. v. Walling, 326 U.S. 657 (Supreme Court) (FLSA enacted to protect workers from unequal bargaining power)
- Morgan v. Family Dollar Stores, Inc., 551 F.3d 1233 (11th Cir.) (collective actions pool resources and resolve common issues efficiently)