United States: What Does Tyson Foods, Inc. v. Bouaphakeo Mean For Class Actions?

Last Updated: March 31 2016
Article by Andrew J. Pincus

The class action plaintiffs' bar celebrated yesterday's Supreme Court's decision in Tyson Foods, Inc. v. Bouaphakeo (pdf), rejecting Tyson's challenge to class certification. One lawyer called it "a huge David v. Goliath victory."

But when plaintiffs' lawyers wake up this morning and focus on the details of the Court's opinion, they are in for a serious post-celebration hangover.

The Court's reasoning for the first time maps a clear route for defendants to use in challenging plaintiffs' use of statistical evidence in class actions. It also provides important guidance for defendants about preserving the ability to challenge plaintiffs' reliance on statistics.

Background

Tyson involved claims under the overtime pay requirements of the Fair Labor Standards Act (FLSA). The named plaintiffs, hourly workers at a Tyson pork processing plant, claimed that the company failed to compensate them or the other 3,344 employees for time spent donning and doffing protective equipment and walking to and from their work stations. Prior to trial, the district court certified the FLSA claims as an opt-in collective action and the state-law claims as a Federal Rule of Civil Procedure 23(b)(3) class action. (The Court assumed that the standards for both types of certification are similar.)

Because Tyson did not keep records of each employee's donning and doffing time, the plaintiffs relied on what they characterized as "representative evidence," which consisted principally of two studies. One, conducted by their expert Dr. Mericle, used 744 "videotaped observations" to conclude that employees in the "cut and retrim departments" averaged 18 minutes a day, and those in the "kill department" averaged 21 minutes per day.

The second study, conducted by Dr. Fox, used each employee's time records—combined with the Mericle time estimates—to determine which employees were entitled to overtime pay based on the addition of the donning and doffing time to their work weeks. The study found that 212 class members were not entitled to recover, and that the remaining class members were entitled to an aggregate award of $6.7 million.

The jury returned a special verdict finding that donning and doffing time at the beginning and end of the work day was compensable, but that donning and doffing for meal breaks was not. It awarded $2.9 million.

Tyson moved to set aside the verdict. It argued that the individual variations in donning and doffing times—reflected in the Fox study—meant that the class should not have been certified, because it did not satisfy Rule 23(b)(3)'s "predominance" requirement: that "questions of law or fact common to class members predominate over" any questions affecting only individual class members. Both the district court and the court of appeals rejected Tyson's arguments.

The Supreme Court's decision

The Supreme Court addressed two issues.

Predominance and statistical analysis

The first issue is whether the class satisfied the predominance requirement—and the parties agreed that the predominance question turned on whether the Fox study could properly be used to prove the donning and doffing time. Tyson argued that these were "necessarily person-specific inquiries" while the plaintiffs asserted that—based on the Mericle study—it could "be assumed each employee donned and doffed for the same average time observed" in the study. Thus, the Supreme Court stated, "[w]hether this inference is permissible becomes the central dispute in the case."

The Court rejected the argument, advanced by Tyson and some of its amici, for a categorical exclusion of representative or statistical evidence in class actions, and refused to "establish general rules governing the use of statistical evidence . . . in all class-action cases." That is because the use of such evidence to establish classwide liability "will depend on the purpose for which the evidence is being introduced and on 'the elements of the underlying causes of action.'"

A key question, the Court said, is whether "each class member could have relied on [the statistical evidence] to establish liability if he or she had brought an individual action"; if so, "that [evidence] is a permissible means of establishing the employees' hours worked in a class action."

The Court held that this test was met here, because of a legal rule applicable to FLSA claims: Anderson v. Mt. Clemens Pottery Co., 328 U.S. 680, 687-88 (1946), held that when an employer has not complied with its statutory obligation to keep proper records, an employee "if he produces sufficient evidence to show the amount and extent of [uncompensated] work as a matter of just and reasonable inference"; the employer then must "come forward with evidence of the precise amount of work performed or with evidence to negative the reasonableness of the inference to be drawn from the employee's evidence."

Under Mt. Clemens, the Court stated, the Mericle study would have been a valid method of proof in individual cases. It therefore was a valid means of proof in the class action.

Tyson does not categorically approve the use of statistical evidence in class actions generally. Indeed, the Court reiterated at the end of its analysis that the question requires a case-specific inquiry: "[w]hether a representative sample may be used to establish classwide liability will depend on the purpose for which the sample is being introduced and on the underlying cause of action. . . . The fairness and utility of statistical methods in contexts other than [FLSA actions] will depend on facts and circumstances particular to those cases."

Here are some of the case-specific inquiries identified by the Tyson Court:

  • Whether the statistical evidence is probative of the factual issue that controls the application of the governing substantive rule. The Tyson Court's distinction of Wal-Mart Stores, Inc. v. Dukes, 564 U.S. 338 (2011), which had rejected a "Trial By Formula" approach for a Title VII discrimination class action, is illuminating:

    The plaintiffs in Wal-Mart did not provide significant proof of a common policy of discrimination to which each employee was subject. "The only corporate policy that the plaintiffs' evidence convincingly establishe[d was] Wal-Mart's 'policy' of allowing discretion by local supervisors over employment matters"; and even then, the plaintiffs could not identify "a common mode of exercising discretion that pervade[d] the entire company." . . . .

    [T]he [Wal-Mart] Court held that the employees were not similarly situated, [and therefore] none of them could have prevailed in an individual suit by relying on depositions detailing the ways in which other employees were discriminated against by their particular store managers.

    In Tyson, the Court reached the opposite conclusion, because

    the study here could have been sufficient to sustain a jury finding as to hours worked if it were introduced in each employee's individual action. While the experiences of the employees in Wal-Mart bore little relationship to one another, in this case each employee worked in the same facility, did similar work, and was paid under the same policy. As Mt. Clemens confirms, under these circumstances the experiences of a subset of employees can be probative as to the experiences of all of them.

    That explanation shows the importance of case-specific analysis, and the limited scope of Tyson's holding.
  • Whether reliance on statistical evidence to certify a class will "deprive [the defendant] of its ability to litigate individual defenses." Defendants in class actions frequently rely on the provision of the Rules Enabling Act stating that a rule may not "abridge . . . any substantive right." 28 U.S.C. § 2072(b). The Tyson Court emphasized this provision's relevance to class actions, referring to "the Rules Enabling Act's pellucid instruction that use of the class device cannot 'abridge . . . any substantive right.'" It concluded that Tyson was not deprived of its ability to litigate individual defenses because "there were no alternative means for the employees to establish their hours worked" and no defense for Tyson other than challenging the study. In many other types of class actions, however, the defendant will be able to defend by presenting class member-specific evidence, and in such situations the defendant should have a strong basis for defeating class certification. Indeed, the Tyson Court stated that would have been the case in Wal-mart.
  • Whether the statistical evidence would be admissible in an individual action under the balancing tests established by Federal Rules of Evidence 401 and 403—which the Court cited repeatedly in its opinion. That, in turn, will often depend on the other evidence that is available; the unavailability of actual employee-specific information was key to the Tyson Court's analysis. In other contexts, of course, actual plaintiff-specific information will be available.
  • Whether the statistical study is admissible under Federal Rule of Evidence 702. The Supreme Court noted that Tyson "did not raise a challenge to [the plaintiffs'] experts' methodology under Daubert [v. Merrell Dow Pharmaceuticals, Inc.]; and, as a result, there is no basis in the record to conclude it was legal error to admit that evidence."

Excluding uninjured class members

The second issue that the Tyson Court addressed was whether class certification was improper because there was no mechanism for ensuring that only injured class members would receive compensation.

Again, some factual background is useful. The jury's award of $2.9 million was considerably less than the $6.7 million award indicated by the Fox study. Tyson argued that the lower damages amount meant that the jury had rejected the Mericle study's time estimates, and that it therefore was not possible to know which class members were entitled to damages. Awarding damages to each class member would mean that some individuals found by the jury not to be injured would nonetheless receive compensation.

The Court stated that "the question whether uninjured class members may recover is one of great importance," but concluded it was not properly before the Court in this case "because the damages award has not yet been disbursed, nor does the record indicate how it will be disbursed." It held that Tyson "may raise a challenge to the proposed method of allocation when the case returns to the District Court."

But the Court also noted that "this problem appears to be one of [Tyson's] own making," because Tyson had rejected the plaintiffs' suggestion to bifurcate the liability and damages phases of the trial, which was made "for the precise reason that it may be difficult to remove uninjured individuals from the class after an award is rendered." Whether "any error should be deemed invited" by Tyson was an issue left to the district court.

Chief Justice Roberts, joined by Justice Alito, addressed this issue in detail in a concurring opinion, concluding that the plaintiffs' proposal for allocating the award would not weed out uninjured plaintiffs—and expressed skepticism about reliance on invited error because "Tyson's insistence on a lump-sum jury award cannot overcome the limitations placed on the federal courts by the Constitution" (referring to Article III's injury-in-fact requirement).

The Court's emphasis on the "great importance" of the issue of uninjured class members, combined with the Chief Justice's focus on Article III, means that defendants should continue to focus on this issue in litigating class actions. To the extent that a class is defined broadly—and the liability determinations in the merits phase of the case are not certain to weed out all uninjured parties—there is a strong argument that the class certification decision cannot stand.

However, the Court's reference to invited error means that defendants should take care to propose, or at least not oppose, procedures that would ensure that uninjured class members are identified and excluded from any eventual damages award.

In sum, the Tyson decision is far from a home run for plaintiffs. The Court supplemented Wal-Mart by defining in greater detail the standards that must be satisfied when plaintiffs seek to rely on statistical evidence to transform individualized issues into common ones for purposes of Rule 23(b)(3)'s predominance inquiry.

Originally published March 23, 2016

Visit us at mayerbrown.com

Mayer Brown is a global legal services provider comprising legal practices that are separate entities (the "Mayer Brown Practices"). The Mayer Brown Practices are: Mayer Brown LLP and Mayer Brown Europe – Brussels LLP, both limited liability partnerships established in Illinois USA; Mayer Brown International LLP, a limited liability partnership incorporated in England and Wales (authorized and regulated by the Solicitors Regulation Authority and registered in England and Wales number OC 303359); Mayer Brown, a SELAS established in France; Mayer Brown JSM, a Hong Kong partnership and its associated entities in Asia; and Tauil & Chequer Advogados, a Brazilian law partnership with which Mayer Brown is associated. "Mayer Brown" and the Mayer Brown logo are the trademarks of the Mayer Brown Practices in their respective jurisdictions.

© Copyright 2016. The Mayer Brown Practices. All rights reserved.

This Mayer Brown article provides information and comments on legal issues and developments of interest. The foregoing is not a comprehensive treatment of the subject matter covered and is not intended to provide legal advice. Readers should seek specific legal advice before taking any action with respect to the matters discussed herein.

To print this article, all you need is to be registered on Mondaq.com.

Click to Login as an existing user or Register so you can print this article.

Authors
 
In association with
Related Video
Up-coming Events Search
Tools
Print
Font Size:
Translation
Channels
Mondaq on Twitter
 
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).
 
Email Address
Company Name
Password
Confirm Password
Position
Mondaq Topics -- Select your Interests
 Accounting
 Anti-trust
 Commercial
 Compliance
 Consumer
 Criminal
 Employment
 Energy
 Environment
 Family
 Finance
 Government
 Healthcare
 Immigration
 Insolvency
 Insurance
 International
 IP
 Law Performance
 Law Practice
 Litigation
 Media & IT
 Privacy
 Real Estate
 Strategy
 Tax
 Technology
 Transport
 Wealth Mgt
Regions
Africa
Asia
Asia Pacific
Australasia
Canada
Caribbean
Europe
European Union
Latin America
Middle East
U.K.
United States
Worldwide Updates
Check to state you have read and
agree to our Terms and Conditions

Terms & Conditions and Privacy Statement

Mondaq.com (the Website) is owned and managed by Mondaq Ltd and as a user you are granted a non-exclusive, revocable license to access the Website under its terms and conditions of use. Your use of the Website constitutes your agreement to the following terms and conditions of use. Mondaq Ltd may terminate your use of the Website if you are in breach of these terms and conditions or if Mondaq Ltd decides to terminate your license of use for whatever reason.

Use of www.mondaq.com

You may use the Website but are required to register as a user if you wish to read the full text of the content and articles available (the Content). You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these terms & conditions or with the prior written consent of Mondaq Ltd. You may not use electronic or other means to extract details or information about Mondaq.com’s content, users or contributors in order to offer them any services or products which compete directly or indirectly with Mondaq Ltd’s services and products.

Disclaimer

Mondaq Ltd and/or its respective suppliers make no representations about the suitability of the information contained in the documents and related graphics published on this server for any purpose. All such documents and related graphics are provided "as is" without warranty of any kind. Mondaq Ltd and/or its respective suppliers hereby disclaim all warranties and conditions with regard to this information, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. In no event shall Mondaq Ltd and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use or performance of information available from this server.

The documents and related graphics published on this server could include technical inaccuracies or typographical errors. Changes are periodically added to the information herein. Mondaq Ltd and/or its respective suppliers may make improvements and/or changes in the product(s) and/or the program(s) described herein at any time.

Registration

Mondaq Ltd requires you to register and provide information that personally identifies you, including what sort of information you are interested in, for three primary purposes:

  • To allow you to personalize the Mondaq websites you are visiting.
  • To enable features such as password reminder, newsletter alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our information providers who provide information free for your use.

Mondaq (and its affiliate sites) do not sell or provide your details to third parties other than information providers. The reason we provide our information providers with this information is so that they can measure the response their articles are receiving and provide you with information about their products and services.

If you do not want us to provide your name and email address you may opt out by clicking here .

If you do not wish to receive any future announcements of products and services offered by Mondaq by clicking here .

Information Collection and Use

We require site users to register with Mondaq (and its affiliate sites) to view the free information on the site. We also collect information from our users at several different points on the websites: this is so that we can customise the sites according to individual usage, provide 'session-aware' functionality, and ensure that content is acquired and developed appropriately. This gives us an overall picture of our user profiles, which in turn shows to our Editorial Contributors the type of person they are reaching by posting articles on Mondaq (and its affiliate sites) – meaning more free content for registered users.

We are only able to provide the material on the Mondaq (and its affiliate sites) site free to site visitors because we can pass on information about the pages that users are viewing and the personal information users provide to us (e.g. email addresses) to reputable contributing firms such as law firms who author those pages. We do not sell or rent information to anyone else other than the authors of those pages, who may change from time to time. Should you wish us not to disclose your details to any of these parties, please tick the box above or tick the box marked "Opt out of Registration Information Disclosure" on the Your Profile page. We and our author organisations may only contact you via email or other means if you allow us to do so. Users can opt out of contact when they register on the site, or send an email to unsubscribe@mondaq.com with “no disclosure” in the subject heading

Mondaq News Alerts

In order to receive Mondaq News Alerts, users have to complete a separate registration form. This is a personalised service where users choose regions and topics of interest and we send it only to those users who have requested it. Users can stop receiving these Alerts by going to the Mondaq News Alerts page and deselecting all interest areas. In the same way users can amend their personal preferences to add or remove subject areas.

Cookies

A cookie is a small text file written to a user’s hard drive that contains an identifying user number. The cookies do not contain any personal information about users. We use the cookie so users do not have to log in every time they use the service and the cookie will automatically expire if you do not visit the Mondaq website (or its affiliate sites) for 12 months. We also use the cookie to personalise a user's experience of the site (for example to show information specific to a user's region). As the Mondaq sites are fully personalised and cookies are essential to its core technology the site will function unpredictably with browsers that do not support cookies - or where cookies are disabled (in these circumstances we advise you to attempt to locate the information you require elsewhere on the web). However if you are concerned about the presence of a Mondaq cookie on your machine you can also choose to expire the cookie immediately (remove it) by selecting the 'Log Off' menu option as the last thing you do when you use the site.

Some of our business partners may use cookies on our site (for example, advertisers). However, we have no access to or control over these cookies and we are not aware of any at present that do so.

Log Files

We use IP addresses to analyse trends, administer the site, track movement, and gather broad demographic information for aggregate use. IP addresses are not linked to personally identifiable information.

Links

This web site contains links to other sites. Please be aware that Mondaq (or its affiliate sites) are not responsible for the privacy practices of such other sites. We encourage our users to be aware when they leave our site and to read the privacy statements of these third party sites. This privacy statement applies solely to information collected by this Web site.

Surveys & Contests

From time-to-time our site requests information from users via surveys or contests. Participation in these surveys or contests is completely voluntary and the user therefore has a choice whether or not to disclose any information requested. Information requested may include contact information (such as name and delivery address), and demographic information (such as postcode, age level). Contact information will be used to notify the winners and award prizes. Survey information will be used for purposes of monitoring or improving the functionality of the site.

Mail-A-Friend

If a user elects to use our referral service for informing a friend about our site, we ask them for the friend’s name and email address. Mondaq stores this information and may contact the friend to invite them to register with Mondaq, but they will not be contacted more than once. The friend may contact Mondaq to request the removal of this information from our database.

Security

This website takes every reasonable precaution to protect our users’ information. When users submit sensitive information via the website, your information is protected using firewalls and other security technology. If you have any questions about the security at our website, you can send an email to webmaster@mondaq.com.

Correcting/Updating Personal Information

If a user’s personally identifiable information changes (such as postcode), or if a user no longer desires our service, we will endeavour to provide a way to correct, update or remove that user’s personal data provided to us. This can usually be done at the “Your Profile” page or by sending an email to EditorialAdvisor@mondaq.com.

Notification of Changes

If we decide to change our Terms & Conditions or Privacy Policy, we will post those changes on our site so our users are always aware of what information we collect, how we use it, and under what circumstances, if any, we disclose it. If at any point we decide to use personally identifiable information in a manner different from that stated at the time it was collected, we will notify users by way of an email. Users will have a choice as to whether or not we use their information in this different manner. We will use information in accordance with the privacy policy under which the information was collected.

How to contact Mondaq

You can contact us with comments or queries at enquiries@mondaq.com.

If for some reason you believe Mondaq Ltd. has not adhered to these principles, please notify us by e-mail at problems@mondaq.com and we will use commercially reasonable efforts to determine and correct the problem promptly.