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On Thursday, April 12, 2012, the California Supreme Court issued
its much anticipated decision in Brinker Restaurant Corp. v.
Superior Court. In addition to providing needed clarity
regarding the law of meal and rest periods (which we separately
analyze
here), the decision also contains several defense-friendly
statements regarding class action law more generally.
First, the Court agreed with the dominant line of precedent by
holding that a trial court may reach questions regarding the merits
of the plaintiff's claims where the answer to those questions
will "affect" the class certification decision. Indeed,
where "the propriety of class certification depends upon
disputed threshold legal or factual questions," the trial
court "must resolve" those disputed threshold
questions first. (Emphasis added.) For example, the Court
recognized that "whether common or individual questions
predominate will often depend upon resolution of issues closely
tied to the merits." Implicit in the Court's ruling is
that a trial court commits error if it fails to first resolve such
"necessary" issues prior to reaching the class
certification question.
Second, the Court confirmed what a trial court should focus on
in reaching the class certification decision. In particular,
"[a] court must examine the allegations of the complaint and
supporting declarations and consider whether the legal and factual
issues they present are such that their resolution in a single
class proceeding would be both desirable and
feasible." (Emphasis added.) Citing Professor Richard
Nagareda's NYU Law Review commentary on class actions
– importantly, the same authority relied on by the United
States Supreme Court in its recent, defense-friendly decision in
Wal-Mart Stores, Inc. v. Dukes – the Court
reasoned that "'what really matters to class
certification' is 'not similarity at some unspecified level
of generality but, rather, dissimilarity that has the capacity to
undercut the prospects for joint resolution of class members'
claims through a unified proceeding.'" This is important
because it sets forth a standard whereby a defendant can defeat
class certification by presenting declarations or other
individualized evidence which reveals that disputed questions about
essential elements of liability can be resolved only through
individualized testimony.
Lastly, in rejecting the plaintiffs' request for class
certification as to their claim that they worked off the clock, the
Court further embraced the narrow view of class certification
advanced by the United States Supreme Court in Dukes. The
Court reasoned that "where no substantial evidence points to a
uniform, companywide policy" in violation of the law,
"proof of off-the-clock liability would have had to continue
in an employee-by-employee fashion, demonstrating who worked off
the clock, how long they worked, and whether Brinker knew or should
have known of their work." For this reason, class
certification was improper. Implicit in this ruling is a
determination that the case could not have been tried using a
"Trial by Formula" approach. Under the "Trial by
Formula" approach, a sample set of the class is chosen, the
trial court then determines how much the members of the sample set
worked without pay, and the results are then applied against the
class as a whole. This aspect of the decision represents another
win for defendants in class actions, in that it is consistent with
the United States Supreme Court's holding that the "Trial
by Formula" approach violates the defendant's due process
right to present evidence and challenge liability as to each member
of the proposed class.
The content of this article is intended to provide a general
guide to the subject matter. Specialist advice should be sought
about your specific circumstances.
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