DECISION AND ORDER
Plaintiff, Patrick Mendez, commenced this action against his former employer, Radec Corporation (“Radec”), and two of its officers, alleging that Radec has violated the Fair Labor Standards Act (“FLSA”), 29 U.S.C. § 201 et seq., and the New York Labor Law (“Labor Law”), by failing to pay wages to which Mendez was legally entitled. Mendez also alleges that Radec terminated his employment in retaliation for his complaints about Radee’s wage violations.
The Court has issued several decisions and orders in this ease, familiarity with all of which is assumed, that are relevant to an understanding of the issues now before me. On February 26, 2004, in open court, I directed that potential class members be given notice of the existence of this action and of their rights to opt in to the action under the FLSA’s “collective action” provision, 29 U.S.C. § 216(b). Dkt. # 45.
On November 22, 2005, the Court issued a Decision and Order, which: granted in part and denied in part plaintiffs motion for summary judgment; granted plaintiffs motion for class certification of his Labor Law claims under Rule 23(b)(3) of the Federal Rules of Civil Procedure; and denied defendants’ motion to “decertify” plaintiffs collective action under the FLSA.
Following the issuance of that Decision and Order, defendants moved pursuant to Rules 54(b) and 59(e), and 28 U.S.C. § 1292(b), for an order reconsidering, altering, or amending the Court’s November 2005 Decision and Order, or alternatively, certifying the matter for interlocutory appeal. On January 30, 2006, the Court issued a Decision and Order denying defendants’ motion.
Defendants have now filed a motion (Dkt.# 216) to decertify the Rule 23 class, pursuant to Rule 23(c)(1)(C), which provides that “[a]n order that grants or denies class certification may be altered or amended before final judgment.” Plaintiffs oppose the motion.
DISCUSSION
I. General Principles
“Even after a [class] certification order is entered, the [district] judge remains free to modify it in the light of subsequent developments in the litigation.” General Tel. Co. of the Southwest v. Falcon,
“In fact, a federal district court judge has an affirmative obligation to ensure” that class certification remains appropriate throughout the litigation. Wu v. MAMSI Life & Health Ins. Co.,
Like the initial decision whether to certify a class, the question of whether to decertify a class lies committed to the discretion of the district court. See Wu,
“[T]he four prerequisites of Rule 23(a) [are]: numerosity, commonality, typicality, and adequacy of representation.” Marisol A. v. Giuliani
In the case at bar, the Court found in its November 22, 2005 Decision and Order that plaintiffs had met the certification requirements of Rule 23(b)(3), which provides for certification when (1) questions of law or fact common to the class members predominate over any questions affecting only individual members, and (2) a class action would be superior to other available methods for the fair and efficient adjudication of the controversy. See
In support of their motion to decertify, defendants focus on two of the requirements of Rule 23: adequacy of class counsel, and the predominance of classwide over individual issues. Defendants contend that the record now shows that neither condition has been satisfied.
II. Alleged Inadequacy of Class Counsel
Defendants contend that class counsel have proved themselves to be inadequate in a number of respects. In particular, defendants assert that class counsel have made several glaring errors that have disadvantaged and prejudiced class members.
As other courts have observed, objections by defendants to the adequacy of class counsel sometimes need to be taken “with a grain of salt.” Williams v. Balcor Pension Investors,
Plaintiff Mendez moved for summary judgment (Dkt.# 131) at the same time that he moved for class certification (Dkt.# 134). In its November 22, 2005 Decision and Order (Dkt.# 195), the Court granted the motion to certify, and granted in part and denied in part the motion for summary judgment.
Specifically, the Court granted summary judgment for plaintiff on the issue of defendants’ liability as to claims arising out of travel to job sites where an overnight stay was expected, and for overtime pay for com-pensable travel time when an employee’s total hours exceeded forty hours in a given week. The Court also certified a Rule 23 class with respect to claims under the New York Labor Law asserted by the members of Subclass 2 of the amended complaint.
Defendants contend that the summary judgment ruling in favor of Mendez cannot be applied to the class as a whole, because of the rule against “one-way intervention,” which “bars potential class members from waiting on the sidelines to see how the lawsuit tons out and, if a judgment for the class is entered, intervening to take advantage of the judgment,” while only the named plaintiff would be bound by a judgment in favor of the defendant. Amati v. City of Woodstock,
In response, plaintiffs contend that defendants’ delay in raising this issue is itself grounds for denying defendants’ motion. Plaintiffs also contend that there was nothing improper or erroneous about counsel’s simultaneously filing, or the Court deciding, their motions for summary judgment and for class certification.
Strictly speaking, whether the summary judgment ruling in favor of Mendez can be applied to other class members is not directly before me. Defendants are not now objecting to the Court’s simultaneously ruling on that motion and the class certification motion (and indeed it would seem to be far too late to raise such an objection now), but instead are arguing, based on their position concerning the effect of such simultaneous rulings, that plaintiffs counsel have proven themselves inadequate to represent the interests of the class, and that the class should therefore be decertified. Whether that argument is well-taken, then, depends to a considerable extent on whether the simultaneity of the summary judgment and class certification motions was in fact improper.
Courts have held that in general, issues relating to class certification should be decided before a decision on the merits is rendered. See, e.g., Bertrand v. Maram,
There are exceptions to that general principle, however. For example, there is authority that a defendant can waive any objection to a decision on the merits prior to, or simultaneous with, a decision on class certification. See, e.g., Ahne v. Allis-Chalmers Corp.,
On the facts before me, I conclude that defendants have waived any objections to the procedure that was followed here, and therefore to any argument that the class should be decertified on that basis. Just as the rule against one-way intervention “bars potential class members from waiting on the sidelines to see how the lawsuit turns out and, if a judgment for the class is entered, intervening to take advantage of the judgment,” Amati,
Again, I recognize that defendants are not literally objecting to the procedure itself, but rather are arguing that the procedure that was followed was detrimental to the class, and that it resulted from a blunder on the part of class counsel. That argument, however, amounts to little more than a “back door” attempt to challenge class certification on a ground that defendants could have raised, but failed to assert, when plaintiffs class certification motion was pending before me.
In addition, even aside from any issues concerning waiver, I am not persuaded by defendants’ argument that the Court’s rulings on plaintiffs motion for partial summary judgment cannot be applied to other class members. The cases relied upon by defendants mostly involve pre-certification motions for summary judgment filed by class action defendants, which implicate far different concerns from those present here.
There is authority that when a district court decides a motion for summary judgment before a class has been certified, that decision will not bind putative class members. See, e.g., Chevron USA Inc. v. School Bd. Vermilion Parish,
Virtually all of the reported cases applying that rule, however, involve dispositive motions filed by the defendants. That may be in part because plaintiffs typically do not file dispositive motions until after a class has been certified, but regardless of the reason, that difference renders those eases materially distinguishable from this one.
As stated, pre-certification dispositive motions filed by plaintiffs and defendants implicate different concerns. If an individual plaintiff brings an action, ostensibly on behalf of a class of persons, and the defendant successfully moves against that plaintiff before a class has been certified, clearly it would be inequitable to allow the defendant to use that judgment to prevent other similarly situated persons (who may not even have been aware of the prior litigation) from seeking relief in their own behalf. To avoid such a result, “due process requires at a minimum” that putative class members be given notice of the class action and an opportunity to exclude themselves from the class prior to any judgment being rendered which might affect their rights. Phillips Petroleum Co. v. Shutts,
In accordance with those principles, a judgment entered in a Rule 23(b)(3) class action will not bind putative class members who have opted out of the class, or who did not receive adequate notice of the existence or nature of the action. See Richards v. Delta Air Lines, Inc.,
For much the same reasons, an individual’s claims will not be barred by a judgment in favor of the defendant in an action brought under Rule 23, if no class was ever certified (and hence no notices ever sent) prior to the entry of the judgment. See Wright,
The same considerations are not implicated, however, when the named plaintiff moves for summary judgment prior to a class having been certified. This case well illustrates the reason for the difference.
Arguably, there could be some unfair prejudice to the defendant if a class is certified, and notices sent to putative class members, after a judgment on the merits has been entered in favor of the class. At least in theory, some of the class members might have opted out, had they received notice of the action prior to the judgment on the merits, but would be less likely to do so if they know that the court has already ruled in favor of the class on some issues.
That, however, is why defendants have the right — should they choose to exercise it — to have class certification issues decided first, before any decision on the merits of the plaintiffs’ claims. Defendants here never invoked that right, however. As stated, they thereby implicitly waived that right.
Moreover, unlike a putative class member to whom no notice has been sent, defendants were well aware that this action had been brought against them as a class action, and they must have known that any determinations against them might well inure to the benefit of the class as a whole. Their awareness of that possibility should have been heightened by the fact that plaintiffs had moved for class certification and for summary judgment at the same time. Unlike an absent class member, then, defendants were fully aware of the nature of the claims against them, and they had every incentive to litigate the issues presented by plaintiffs motions.
As a purely practical matter, it is also difficult to see what difference it would make if the Court were to conclude that my ruling in plaintiffs favor on his motion for partial summary judgment should not apply to the class as a whole. The gist of the Court’s ruling was simply that Radec had engaged in certain practices that violated the law. Specifically, the Court found that “the record clearly shows that in many instances no compensation was paid [by Radec] for [compen-sable] travel time,” and that “on at least some occasions, defendants paid Radec employees for travel time at straight-time rates, even though the employee had worked over 40 hours that week” and hence should have been paid at overtime rates.
In addition, even if, in hindsight, class counsel would have been better advised to await the Court’s decision on class certification before moving for summary judgment (if for no other reason than to avoid defendants’ subsequent motion to decertify on this ground), this certainly did not amount to such an egregious blunder as to warrant decertification of the class. See Koss v. Wackenhut Corp., No. 03 Civ. 7679,
B. Failure to Seek Court-Approved Notice of Rule 23(b)(3) Class Action
Defendants also contend that class counsel have demonstrated their inadequacy by failing to seek to obtain Court approval of a notice to be sent to the Rule 23(b)(3) class. In a Rule 23(b)(3) action, notice must be sent to absent class members to give them the opportunity to opt out. See Eisen,
In response to this argument, plaintiffs state that “this Court has not yet ordered that notice be sent” and that “until such time as the Court orders notice to be sent to the class members, plaintiffs cannot be accused of unduly delaying notice.” Plaintiffs Mem. (Dkt.# 222) at 10. Plaintiffs aver that they “stand ready to send [notice] at any time deemed appropriate by the Court and upon
Rule 23(c)(2)(B) states in part that “[f]or any class certified under Rule 23(b)(3), the court must direct to class members the best notice that is practicable under the circumstances, including individual notice to all members who can be identified through reasonable effort.” Although it is ultimately the court’s duty to order that notice be sent, see Culver v. City of Milwaukee,
In accordance with that principle, courts have held that class counsel’s failure to send notice to the class can be a factor weighing in favor of decertification. In general, however, such cases involve counsel’s failure to carry out the court’s order directing the issuance of notice, rather than counsel’s failure to move for such an order. See, e.g., Sheinberg v. Sorensen, No. 00-6041,
The court in Dubin v. Miller,
In the case at bar, certainly class counsel could by now have taken steps to seek approval and direction from the Court relative to the form and sending of notice to the class. Nevertheless, I do not believe that counsel’s delay in that regard is serious enough to warrant decertification. Counsel have otherwise been diligent in prosecuting this action, and the interests of the class would not be served in any way by decertification. See Wells,
Furthermore, the issue of notice in many ways overlaps with the issues concerning simultaneous class certification and summary judgment motions discussed above. A primary purpose of the notice requirement is to preserve absent class members’ rights to pursue their own individual claims, and to protect them from being bound by a judgment in an action of which they have been given no, or inadequate, notice or opportunity to exclude themselves. See Thorn v. Jefferson-Pilot Life Ins. Co.,
Those concerns are not implicated here. The Court has simply ruled that defendants engaged in certain unlawful practices with regard to the payment of overtime wages to Radec employees. That is now the law of the case, but it does not, and could not, “bind” absent class members in any way. When they have been given notice, class members will have an opportunity to opt out of this action and, if they wish, to file their own individual claims.
C. Failure to Pursue “Joint Employers”
In August 2004, plaintiffs amended the complaint to name ten additional defendants, all of whom were apparently temporary-employment agencies and subcontractors, on the theory that they were “joint employers” with Radec. See Dkt. # 111 ¶ 25. None of those additional defendants has ever been served, however, and one has been dismissed by stipulation. See Dkt. # 127, #193.
Defendants contend that class counsel’s failure to pursue the claims against those additional defendants is further evidence of class counsel’s inadequacy. They assert that this failure is particularly egregious because class counsel “has long been aware of Ra-dec’s dire financial condition” and possible inability to satisfy a judgment against it. Defendants’ Mem. (Dkt.# 218) at 16. In response, plaintiffs contend that “[t]he fact that these co-defendants have not been pursued relates to plaintiffs case strategy,” Plaintiffs Mem. (Dkt.# 222) at 11, although they have not stated what that strategy is.
The court in Dubin did state that class counsel’s “failure to join all responsible parties as defendants further supports the finding that plaintiff and counsel do not adequately represent the class.”
D. Failure to File Consent for Patrick Mendez
Next, defendants point out that class counsel have never filed a written consent by the lead plaintiff, Patrick Mendez, to participate in the FLSA collective action. Defendants
Under the FLSA, an aggrieved employee may sue “in behalf of himself ... and other employees similarly situated. No employee shall be a party plaintiff to any such action unless he gives his consent in writing to become such a party and such consent is filed in the court in which such action is brought.” 29 U.S.C. § 216(b). Although it may seem curious that this consent requirement would apply to a named plaintiff, this requirement has been held to apply even to the named plaintiffs in a collective action under the FLSA. See, e.g., Harkins v. Riverboat Services, Inc.,
In opposition to defendants’ motion, plaintiffs cite authority that “the requirement that plaintiffs in a representative action file a written consent with the district court applies only to those parties who are not named as plaintiffs in the complaint.” Anderson v. Montgomery Ward & Co.,
Although the court in Harkins also emphasized “[t]he importance of a strict interpretation” of the consent requirement, id. at 1101, courts have generally not taken a strict approach with regard to the form of the written consent, as least with respect to named plaintiffs.
In the case at bar, plaintiff Mendez filed a signed affirmation with the Court on December 19, 2003 (Dkt.# 15), in support of plaintiffs’ first motion for class certification Rule 23 and for court approval for this action to proceed as a collective action under the FLSA.
That clearly indicates Mendez’s understanding that he was consenting to be a plaintiff in this collective action under the FLSA. Accordingly, I conclude that it satisfied the written-consent requirement of § 216(b).
E. Failure to Prosecute
Defendants also contend that, in addition to the various alleged failures and errors recited above, class counsel have simply done very little to prosecute this action. In particular, they assert that class counsel have done virtually nothing to move this case along since the Court’s November 22, 2005 decision on the class certification and partial summary judgment motions.
The Court is certainly very familiar with this action, and while it does appear that the case could at times have been pursued with more vigor, I do not believe that all the delays in this case can justifiably be laid at the feet of class counsel, or that those delays are inexcusable. There have been some settlement negotiations, which unfortunately have not borne fruit, as well as disputes about a number of matters. Not everything that has taken place during this litigation is necessarily reflected on the Court’s docket sheet, and to the extent that there have been delays, I believe that class counsel are no more blameworthy than are defendants and their attorneys.
II. Whether Individual Issues Predominate over Class Issues
Apart from the alleged inadequacy of class counsel, defendants also contend that decertification is warranted because individual issues predominate over classwide issues, so that this action does not satisfy the requirement of Rule 23(b)(3) that “questions of law or fact common to class members predominate over any questions affecting only individual members____” Although the Court considered, and rejected, this same argument in its decision certifying the class, see
In McLaughlin, the Court of Appeals ordered decertification of a class under the Racketeer Influenced and Corrupt Organizations Act (“RICO”), because “numerous issues in th[e] case [we]re not susceptible to generalized proof but would require a more individualized inquiry,” which led the court to “conclude that the predominance requirement of Rule 23 ha[d] not been satisfied.” Id. at 234.
The fact that McLaughlin was decided in the context of a RICO claim, however, renders it of limited value here. The court’s decision in McLaughlin was based to a great extent on the requirement that a plaintiff alleging mail or wire fraud as the predicate act for a civil RICO claim demonstrate that he relied on the defendant’s misrepresentation. With respect to that element, the court stated that “reliance on the misrepresentation [which in McLaughlin involved cigarette manufacturers’ alleged representations that ‘light’ cigarettes were ‘healthier’ than ‘full-flavored’ cigarettes] cannot be the subject of general proof.” Id. at 223. The court stated that individualized proof would be “needed to overcome the possibility that a member of the purported class purchased Lights for some reason other than the belief that Lights were a healthier alternative — for example, if a Lights smoker was unaware of that representation, preferred the taste of Lights, or
The case at bar does not present the same difficulties. As the Court stated in its prior decision granting class certification, the fact that “some issues related to damages may require individualized proof ... is not a basis for finding that Rule 23(b)(3)’s predominance criterion has not been met.”
In short, I am no more persuaded now by defendants’ arguments concerning this issue than I was when I issued my Decision and Order certifying the class. Neither the applicable law nor the relevant facts have changed in any way that warrants the Court rethinking that decision. See Ali v. Muka-sey,
III. CPLR § 901(b)
Defendants also contend that plaintiffs cannot maintain a class action on their Labor Law claims, by virtue of § 901(b) of the New York Civil Practice Law and Rules. That section provides that “[u]nless a statute creating or imposing a penalty, or a minimum measure of recovery specifically authorizes the recovery thereof in a class action, an action to recover a penalty, or minimum measure of recovery created or imposed by statute may not be maintained as a class
In response, plaintiffs contend, first, that § 901 is a procedural provision that has no application here. Dkt. # 222 at 22 (citing Erie R.R. Co. v. Tompkins,
Plaintiffs also argue — correctly— that § 901 generally does not bar a class action as long as the class members either waive their claims for liquidated damages or opt out. For that reason, the argument that § 901(b) bars class actions for Labor Law claims “has been repeatedly rejected by the courts.” Klein v. Ryan Beck Holdings, Inc., No. 06 Civ. 3460,
Accordingly, I will deny defendants’ motion to decertify plaintiffs’ Labor Law claims, with the understanding that, barring an intervening change in the law from the Supreme Court or otherwise, any plaintiff who does not opt out of the class will have to waive any claims to liquidated damages under the Labor Law.
CONCLUSION
Defendants’ motion to decertify plaintiffs’ Rule 23 class (Dkt.# 216) is denied.
Plaintiffs are hereby directed to file, no later than twenty (20) days after the date of issuance of this Decision and Order, a motion for an order approving the form and contents of a notice, and the manner of issuance of such notice, to class members, pursuant to Rule 23(c)(2)(B) of the Federal Rules of Civil Procedure. Defendants shall file a response within fourteen (14) days after the filing of plaintiffs’ motion.
IT IS SO ORDERED.
Notes
. Subclass 2 consists of class members whose claims focus on defendants’ alleged failure to pay any compensation, or to pay compensation at the rate required by law, for compensable time, in-eluding "regular" work time, travel time to "overnight” job sites, and meal periods which were spent predominantly for Radec’s benefit.
. At oral argument on defendants’ motion to decertify, defense counsel, responding to the Court's query whether defendants' failure to raise this issue prior to the issuance of the Court's certification order presented a problem for defendants with respect to their motion to decertify, replied, "I don’t think it [does]’because obviously it's to our benefit that [plaintiffs] chose to proceed in this fashion...." Dkt. # 229 at 19. In a similar vein, he added, "plus, quite frankly, Your Honor, we didn't think we were going to lose [on plaintiff's motion for] summary judgment ..., which is why we didn't even move....” Dkt. # 229 at 20.
In other words, defendants made a conscious tactical decision not to raise this issue when plaintiff’s summary judgment and certification motions were pending. Their thinking, apparently, was that if the Court were to deny plaintiff's motion, the issue would become moot. If the Court granted both the summary judgment and class certification motions, however, defendants would then spring the trap that — as they saw it — class counsel had unwittingly laid for themselves. While the Court appreciates defense counsel's candor, that sort of gamesmanship is what the waiver doctrine is designed to prevent.
. At one point in their brief, defendants do suggest that decertification is warranted not simply because of class counsel's inadequacy, but because of the fact of the simultaneous rulings on the summary judgment and class certification motions: defendants state that "the Rule 23 class should be decertified” based on Peritz v. Liberty Loan Corp.,
In the case at bar, however, defendants did not object to plaintiff's simultaneously moving for summary judgment and for class certification. It is perhaps in implicit recognition of that difference between this case and Peritz that defendants' motion is primarily based not directly on any alleged improprieties in the simultaneity of plaintiff's motions or this Court’s decisions on those motions, but instead on the alleged errors of class counsel.
. As a number of courts have explained, the due process requirements concerning notice and opt-out rights apply mainly in the context of claims for monetary relief, since "members of a class seeking substantial monetary damages may have divergent interests....” See, e.g., Veneman,
. In addition, even if the class were decertified, putative class members might still be able to make use of the Court's rulings in this case through offensive collateral estoppel, which "permits a plaintiff to bar a defendant from relitigating an issue that was decided in a prior case against the defendant.” Roe v. City of Waterbury,
(1) the issues of both proceedings are identical; (2) the relevant issues were actually litigated and actually decided in the prior proceedings; (3) there was a full and fair opportunity for the litigation of the issues in the prior proceeding, and (4) the issues were necessary to support a valid and final judgement on the merits.
Id. (citing Central Hudson Gas & Elec. Corp. v. Empresa Naviera Santa S.A.,
. I also note that at least one court has held that employees may be allowed to opt in to an FLSA collective action even after the court has issued a decision on the employer’s liability. See Raper v. State of Iowa,
. To some extent, defendants’ motion rests upon circular reasoning. They contend that class counsel’s filing of simultaneous class certification and summary judgment motions has prejudiced the class; that this constituted a serious error that demonstrates counsel’s inadequacy; and that the class should therefore he decertified. The only possible prejudice that could occur here, however, would be decertification itself. As explained above, given the context of this case, as long as the class remains certified, the Court's summary judgment rulings will, as the law of the case, inure to the benefit of the class members.
. The contents of the notice — and specifically what, if anything, it should state concerning the Court's prior rulings in this case — remain to be decided. Compare Postow,
. The reason for strictly adhering to the consent requirement, the court stated, was illustrated in Harkins, where, eight years after the suit was filed, class counsel, who had previously been sanctioned for his conduct of litigation in other cases, still had not produced written consents from 18 of the 21 named plaintiffs, some of whom had been added late, and some of whom, though they appeared in the original complaint, disappeared when the complaint was amended.
. That motion was denied without prejudice on February 26, 2004. Plaintiffs renewed their motion for class certification in January 2005, and that motion was granted.
. Since no issue concerning the statute of limitations is directly before me, I make no findings and draw no conclusions concerning whether any portion of Mendez’s claims are time-barred. See Ketchum,
. Similarly, the court stated that individual proof would be needed to establish civil RICO's “loss causation” element, i.e., that the defendant’s misrepresentations caused the plaintiff to suffer economic loss. The plaintiffs' theory was that the defendants' misrepresentation that "lights” were healthier led to an increased market demand for light cigarettes, which drove up the price of lights, with the result that the plaintiffs were, in effect, overcharged, in the sense that they paid more for lights than they otherwise would have had the truth about lights been known. Observing that "individuals may have relied on defendants’ misrepresentation to varying degrees in deciding to purchase Lights; some may have relied completely, some in part, and some not at all,” the Second Circuit stated that "establishing the first link in the causal chain— that defendants' misrepresentation caused an increase in market demand — would require individualized proof, as any number of other factors could have led to this increase.” Id. at 226.