Industrial Welding Supplies of Hattiesburg, LLC v. Pinson, 2017 Ark. 315

Background

Employees of Industrial Welding (at 15 locations) alleged unpaid earned-but-unused vacation for work performed in 2011 and sued Industrial Welding and successor Airgas after an acquisition closed March 31, 2012.
Plaintiffs relied on the company Employee Manual, employment agreements, internal memos, and an Airgas letter promising payout of earned vacation.
Plaintiffs moved to certify a class defined as persons employed on Dec. 31, 2011, employed at least one year prior, and employed through the acquisition on Mar. 31, 2012.
The Union County Circuit Court granted class certification, finding Plaintiffs satisfied all Rule 23 elements and naming class representatives and class counsel.
Appellants (Industrial Welding and Airgas) appealed interlocutorily, arguing lack of commonality, lack of predominance, and that a class action is not superior; appellants did not request Rule 52 findings below.
The Arkansas Supreme Court held the certification order deficient for failing to define the class claims, issues, or defenses as required by amended Ark. R. Civ. P. 23(b), and remanded with instructions to enter a Rule-23-compliant order; a three-justice dissent argued remand unnecessary absent a Rule 52 request.

Issues

Issue	Plaintiff's Argument	Defendant's Argument	Held
Whether Rule 23 prerequisites (commonality, typicality, adequacy, numerosity) support certification	Plaintiffs argued common legal/factual issues (vacation policy, unpaid vacation) are shared and representative claims are typical	Defendants argued plaintiffs failed to show commonality and predominance; individual issues predominate	Circuit court concluded all Rule 23 elements were satisfied, but Supreme Court could not review merits because of a separate Rule 23(b) defect and remanded
Whether claims/issues/defenses were sufficiently defined in the certification order per amended Rule 23(b)	Plaintiffs relied on the court’s broad finding that Rule 23 elements were met	Defendants emphasized the order’s conclusory language and lack of defined claims/issues/defenses	Court held the order failed to define the class claims, issues, or defenses as required by Rule 23(b) and remanded for a compliant order
Whether appellate court may review certification without additional Rule 52 findings when no party requested them	Plaintiffs implicitly relied on certification order and the record presented on appeal	Defendants noted no Rule 52 motion was made, arguing appellate review of the certification should proceed; dissent stressed precedent refusing remand absent Rule 52 request	Majority held that, after the 2006 amendment to Rule 23(b), the circuit court must comply with Rule 23’s definitional mandate even absent a Rule 52 request; remand required to permit meaningful review; dissent disagreed
Appropriate remedy	Plaintiffs sought affirmation of certification	Defendants sought reversal or remand limited to merits review	Court remanded with instructions to enter an order that defines the class claims, issues, or defenses; majority did not decide merits

Key Cases Cited

ChartOne, Inc. v. Raglon, 373 Ark. 275 (discretionary standard for reviewing class-certification decisions)
Teris, LLC v. Golliher, 371 Ark. 369 (review of record supports certification decision)
Philip Morris Cos. v. Miner, 2015 Ark. 73 (certification review focuses on Rule 23 requirements)
Am. Abstract & Title Co. v. Rice, 358 Ark. 1 (certification inquiry separate from merits)
Lenders Title Co. v. Chandler, 353 Ark. 339 (trial court must undertake enough analysis to permit meaningful appellate review)
Mega Life & Health Ins. Co. v. Jacola, 330 Ark. 261 (no remand for additional findings when no Rule 52 request)
BPS Inc. v. Richardson, 341 Ark. 834 (Rule 52 timely request requires trial court to make specific findings)
Baptist Health v. Haynes, 367 Ark. 382 (discussing interplay of Rules 23 and 52 and the 2006 amendment to Rule 23(b))