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Tuesday, September 10, 2013

Wang v. Chinese Daily News: Ninth Circuit Vacates Prior Order, Again Remands to District Court for Reconsideration of Certification Order in Light of Wal-Mart

In 2004, the plaintiffs in Wang v. Chinese Daily News filed a putative class and collective action against defendant Chinese Daily News (CDN), alleging violations of the federal Fair Labor Standards Act (FLSA), the California Labor Code, and the Unfair Competition Law (UCL). The district court certified the FLSA claim as a collective action and certified the state-law claims as a class action under Federal Rule 23. After a sixteen-day jury trial and a three-day bench trial, the district court entered judgment for the plaintiffs for damages, but denied their request for injunctive relief.

The Ninth Circuit affirmed. Wang v. Chinese Daily News, 623 F.3d 743 (9th Cir. 2010) (discussed here). In 2011, the United States Supreme Court vacated that decision and ordered the Ninth Circuit to reconsider it in light of Wal-Mart Stores, Inc. v. Dukes, 564 U.S. ___ (2011) (discussed here). On remand, the Ninth Circuit reversed the judgment for the class members on remanded to the district court to reconsider its certification order. Wang v. Chinese Daily News, 709 F.3d 829 (9th Cir. 3/4/13) (discussed here).

On September 3, 2013, the Ninth Circuit vacated its opinion of March 4, 2013, denied rehearing and rehearing en banc, and issued a new opinion, which largely tracks its earlier opinion.  The Court held as follows:

CDN could challenge the district court's finding that the commonality requirement of Federal Rule 23(a)(2) was satisfied, even though it originally did not brief the issue. "We conclude that the [Supreme] Court’s decision in Wal-Mart presents a sufficiently significant legal development to excuse any failure of CDN to discuss the commonality requirement of Rule 23(a)(2) in its opening brief." Slip op. at 9.

Although Wal-Mart differed substantially from Wang, the district court should reconsider its commonality finding in light of Wal-Mart:

On remand, the district court must determine whether the claims of the proposed class “depend upon a common contention . . . of such a nature that it is capable of classwide resolution — which means that determination of its truth or falsity will resolve an issue that is central to the validity of each one of the claims in one stroke.” Plaintiffs need not show that every question in the case, or even a preponderance of questions, is capable of classwide resolution. So long as there is “even a single common question,” a would-be class can satisfy the commonality requirement of Rule 23(a)(2). Wal-Mart, 131 S. Ct. at 2556 (alteration and internal quotation marks omitted).
Slip op. at 11. The Court here deleted language from its earlier opinion that the plaintiffs must show "significant proof that [CDN] operated under a general policy of [violating California labor laws]."

The plaintiffs conceded that class certification for their monetary claims under Rule 23(b)(2) could stand in light of Wal-Mart, but the possibility of a Rule 23(b)(2) class seeking injunctive relief remained. As former employees, none of the named plaintiffs had standing to pursue injunctive relief, but "because the Rule 23(b)(2) class was certified by the district court while they were current employees, the class certification with respect to injunctive relief may survive if there are identifiable class members who are still employed by CDN." Slip op. at 12. In another change from its earlier opinion, the Court remanded this issue to the district court for reconsideration.

The Court remanded to the district court for reconsideration of the propriety of class certification under Rule 23(b)(3) for three reasons:

  1. The district court must reconsider commonality under Rule 23(a)(2), as discussed above. 
  2. The district court improperly "create[d] a presumption that class certification [was] proper when an employer’s internal exemption policies are applied uniformly to the employees," and the Ninth Circuit recently has held that an employer's uniform policy of classifying all reporters and account executives as exempt employees is not sufficient to support Rule 23(b)(3) certification in and of itself. See In re Wells Fargo Home Mortg. Overtime Pay Litig., 571 F.3d 953, 958–59 (9th Cir. 2009) (discussed here); Vinole v. Countrywide Home Loans, Inc., 571 F.3d 935, 944–48 n.14 (9th Cir. 2009). 
  3. The district court should consider the impact of the California Supreme Court's decision in Brinker v. Superior Court (2012) 53 Cal.4th 1004 (discussed here). 
Slip op. at 13-16. 

Departing from its prior decision, the Ninth Circuit this time declined to address the calculation of damages, if the district court should find certification appropriate on remand. Slip op. at 16. 

The latest opinion is available here

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