Davis v. J.P. Morgan Chase & Co.
2011 U.S. Dist. LEXIS 37704
W.D.N.Y.2011Background
- Five named plaintiffs sue JPMorgan Chase & Co. and others for misclassifying employees as exempt from overtime under FLSA and New York law.
- Whalen served as a test plaintiff for the class; the court previously granted summary judgment for Chase on the FLSA exemption issue, which the Second Circuit reversed as Whalen not bona fide administrative.
- A fifth amended complaint was filed (Feb. 11, 2011) along with a motion for preliminary settlement approval.
- Cole and Pickle plaintiffs moved to intervene, raising concerns about the settlement and related notices; they filed related actions in California and Southern District of New York, stayed pending this ruling.
- Judicial Panel denied centralization; court noted potential nationwide settlement and that non-settling plaintiffs may object at a fairness hearing.
- Court considers whether intervention is warranted, whether preliminary approval and conditional class certification are appropriate for settlement purposes, and how the class notice should be framed.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Should Cole/Pickle be permitted to intervene? | Intervenors seek to protect class members' interests against settlement. | Intervention would disrupt settlement; interests can be addressed via fairness hearing. | Intervention denied. |
| Whether to preliminarily approve the proposed settlement | Settlement arising from arms-length negotiations is reasonable and fair. | Settlement should be approved if it is fair and adequate. | Preliminary approval granted. |
| Whether to conditionally certify a class for settlement purposes under Rule 23 and the FLSA | Common questions and numerosity support certification for settlement. | Variations among states could undercut commonality; but settlement context allows broader certification. | Conditionally certified for settlement purposes. |
| What must be included in the class notice regarding related actions | Notice should comprehensively inform about related actions and objections. | Not necessary to enumerate all related actions; focus on settlement terms and options. | Notice approved with added information about pendency of Cole, Pickle, and Ebert actions. |
Key Cases Cited
- Wal-Mart Stores, Inc. v. Visa U.S.A., Inc., 396 F.3d 96 (2d Cir.2005) (settlement notice sufficiency and guidance on release)
- D'Amato v. Deutsche Bank AG, 236 F.3d 78 (2d Cir.2001) (court scrutiny required for settlements; avoid collusion)
- In re Warfarin Sodium Antitrust Litigation, 391 F.3d 516 (3d Cir.2004) (variations among states relevant to settlement manageability)
- Denney v. Deutsche Bank AG, 443 F.3d 253 (2d Cir.2006) (criteria for class certification in settlement context)
- In re Holocaust Victim Assets Litigation, 225 F.3d 191 (2d Cir.2000) (presumption of representation; intervention considerations)
- In re Pet Food Products Liability Litigation, 629 F.3d 333 (3d Cir.2010) (settlement class certification considerations)
- In re Community Bank of Northern Virginia, 418 F.3d 277 (3d Cir.2005) (settlement-class certification and due process concerns)
- Klay v. Humana, Inc., 382 F.3d 1241 (11th Cir.2004) (uniform legal principles allow settlement-based certification)