United States: The First Amendment And Class Actions: Leaving No Stone Unturned

A class action brought pursuant to the Fair Labor Standards Act (FLSA) requires a proactive class. Unlike Rule 23 class actions, in which class members must affirmatively opt out in order to be excluded from the class, FLSA class actions require that potential class members notify the court of their desire to opt into the action. Just how far can plaintiffs go in soliciting potential class members? A recent case explores the balance between honoring the First Amendment rights of plaintiffs in communicating with a pool of potential class members and ensuring that defendants do not suffer irreparable harm.

In Hathaway v. Shawn Jones Masonry, a Kentucky district court refused to interfere with the rights of a plaintiff to communicate with other potential plaintiffs in a putative FLSA class action. Michael Hathaway sued his former employer, Shawn Jones Masonry (SJM), alleging violations of the FLSA. To encourage other employees to join the class action suit, Hathaway disseminated a letter that "guarantee[d] success," stating: "PLEASE BE ADVISED THAT YOU ARE ENTITLED TO MONEY WHICH HAS BEEN ILLEGALLY NOT PAID TO YOU BY SHAWN JONES MASONRY . . . A COLLECTIVE ACTION SUIT IS BEING STARTED BY MIKE HATHAWAY AND BEING FILED BY: D. WES SULLENGER, ATTORNEY AT LAW." Each letter also contained a copy of the attorney Sullenger's business card. Sullenger denied any knowledge of the letter and agreed that such communication was improper. Sullenger instructed Hathaway to cease disseminating the letter.

SJM argued that the letter Hathaway sent to current employees caused irreparable harm. SJM contended that current employees would believe that SJM was not treating them fairly and would quit, leaving the company short-staffed. SJM asked that the court enjoin Hathaway from soliciting additional plaintiffs to join the action, as the letter violated Kentucky ethics rule prohibiting a lawyer from soliciting professional employment. Alternatively, SJM requested that Hathaway be enjoined from soliciting additional plaintiffs until the court determined whether the action was appropriate for collective class action. Hathaway, however, asserted his First Amendment rights to communicate with potential plaintiffs and potential witnesses.

In upholding Hathaway's First Amendment rights, the court referenced Gulf Oil Co. v. Bernard, a Supreme Court decision discussing the "heightened susceptibilities of nonparty class members to solicitation amounting to barratry as well as the increased opportunities of the parties and counsel to 'drum up' participation in the proceeding." Gulf Oil granted district courts the broad authority to exercise control over a class action and to enter appropriate orders governing the conduct of parties and counsel. The Supreme Court, however, emphasized the importance of limiting speech as little as possible and "only to the extent consistent with the rights of the parties under the circumstances."

Here, SJM did not offer any evidence that current employees would quit their jobs and leave the company short-staffed. Hathaway, however, demonstrated that he would be harmed by a delay in contacting "potential witnesses, whose memories will fade over time, and potential plaintiffs[,] whose claims against Defendant are diminished on a daily basis." The letter was admittedly improper and in potential violation of the Kentucky ethics rule, but Hathaway had already ceased disseminating it, and no specific harm had befallen SJM. In refusing to dampen Hathaway's rights, the court nevertheless cautioned Hathaway and Sullenger to navigate the ethics rules carefully regarding future contact with prospective clients.

This case demonstrates the importance of First Amendment rights in class action suits and the need for mindfulness in contacting prospective clients. While it might be worthwhile to leave no stone unturned in pursuing potential class members, the specter of being enjoined from soliciting class members altogether represents an effective deterrent for questionable practices. If Sullenger had known about the letter or had not instructed Hathaway to cease dissemination of the letter, the lawsuit might have died a quick death, regardless of the protections of the First Amendment.

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