United States: Class & Collective Action Group Newsletter

Key Issue

Whether the California Supreme Court's decision in Dynamex Ops. W. Inc. v. Superior Court,1 which set standards for differentiating employees from independent contractors, applies retroactively.


In 2008, plaintiffs from a number of states filed a proposed class action in the District Court for the District of Massachusetts alleging that Jan-Pro Franchising International developed a three-tier franchising model to avoid paying its janitors minimum wages and overtime compensation by misclassifying them as independent contractors. The claims of the California plaintiffs were eventually severed and sent to the District Court for the Northern District of California, which granted summary judgment in favor of Jan-Pro in May 2017.2 While this case was proceeding, in a separate test case, affirmed on other grounds on appeal, the Massachusetts court ruled in favor of Jan-Pro.3

Separately, in April 2018, the California Supreme Court held in Dynamex that to prove an individual is an independent contractor, rather than an employee, the hiring entity must show: "(A) that the worker is free from the control and direction of the hirer in connection with the performance of the work, both under the contract for the performance of such work and in fact; (B) that the worker performs work that is outside the usual course of the hiring entity's business; and (C) that the worker is customarily engaged in an independently established trade, occupation, or business of the same nature as the work performed for the hiring entity." 4

In May 2019, on appeal from the District Court's decision, the Court of Appeals for the Ninth Circuit held that the Dynamex decision applied retroactively, and thus the final judgment in Jan-Pro's favor in the Massachusetts case was not entitled to preclusive effect.5 Specifically, the court pointed to California's strong presumption of retroactivity, the Dynamex court's characterization of its decision as a clarification rather than a departure from established law, and the lack of indication that California courts would be likely to hold that the decision only applied prospectively. Jan-Pro then filed a request for rehearing.


On July 22, 2019, the Ninth Circuit issued an order withdrawing its May 2019 opinion in JanPro and announcing that it would file an order certifying to the California Supreme Court the question of whether Dynamex applies retroactively.6

Thoughts & Takeaways

California employers will see their risk of liability of worker misclassification lessen significantly if the California Supreme Court rules that Dynamex does not apply retroactively. Meanwhile, legislation is pending in the California State Senate which would codify certain portions of the Dynamex ruling, including the "ABC" test as articulated therein.

However, the potential impact of the decision on other businesses may be minimized given the prevalence of mandatory individual arbitration clauses in contracts between companies and employees/independent contractors, which may reduce the frequency of such actions.

Read the order here, the Ninth Circuit's prior decision here and the Dynamex decision here.

Oral Argument on Mandamus Petition in Logitech Inc. v. United States District Court for the Northern District of California

Key Issue

Whether a District Court judge's standing order prohibiting parties in a putative class action from discussing a class-wide settlement until after a class has been certified should be withdrawn as unconstitutional and in conflict with Rule 23 of the Federal Rules of Civil Procedure.

Background and Hearing

Plaintiff James Porath brought a putative class action against Logitech in the District Court for the Northern District of California in May 2018, asserting common law fraud and claims under California's Unfair Competition Law and False Advertising Law based on allegations that Logitech advertised a speaker system as having four drivers when, in reality, it only had two.

After the case was assigned to Judge William H. Alsup, the court entered a standing order which, among other things, prohibited the parties from discussing settlement of class claims until after a class had been certified. The order did note that some putative class actions may be appropriate for earlier resolution, in which case the parties must make a motion for appointment of interim class counsel.

The parties attempted to take this route, arguing that the case was appropriate for early settlement. Judge Alsup denied the motion after expressing concerns about potential collusive settlements and entered a scheduling order that contemplated class discovery, expert disclosure and briefing on class certification.

In January 2019, after several interim procedural steps, Logitech filed a petition for a writ of mandamus (a procedure that allows a party to seek an order from an appellate court that is directed at a lower court judge) directing the District Court to withdraw its standing order, arguing that Judge Alsup's standing order improperly restricts the parties' First Amendment rights (free speech and petition) and conflicts with Rule 23 of the Federal Rules of Civil Procedure.7

The Ninth Circuit heard oral argument on the petition on July 18. Counsel for Logitech emphasized that Rule 23(e) contemplates significant judicial involvement in and oversight of the settlement process, and that this is the proper mechanism to take into account concerns regarding a collusive or unfair settlement. A judge may not add to Rule 23(e) by instituting a standing order that imposes additional requirements regarding settlement, and courts generally allow the parties in a putative class action to negotiate and move for settlement. Counsel for the District Court argued that Judge Alsup's standing order does not provide a bar to settlement, and rather seeks to prevent settlement from occurring before the parties and claims have been fully identified. The relevant question, according to counsel, was not whether Rule 23(e) permits opportunity for settlement prior to class certification, but rather requires it.

Thoughts & Takeaways

As Logitech pointed out, the primary concern with standing orders such as the one in this case is that they force parties to a putative class action who may otherwise wish to settle the matter to engage in costly adversarial proceedings before being able to do so. While the stated aim of the order is to discourage collusive or unfair settlements that would harm absent class members, forcing defendants to engage in drawn-out litigation before being able to settle would presumably make the prospect of settling less appealing ex ante.

If the Ninth Circuit were to find such a standing order permissible, this could open the door to other courts instituting similar procedures. Furthermore, other orders could require parties to engage in even lengthier adversarial proceedings, or reorder actions entirely—for example, could a standing order require a mini-trial on the merits prior to class certification, or would this conflict with existing class-action jurisprudence?

Listen to the oral argument here.

Decision in 20/20 Communications, Inc. v. Lennox Crawford

Key Issue

Whether the availability of class arbitration is a gateway issue that courts, not arbitrators, must decide in the absence of "clear and unmistakable" language in the arbitration agreement to the contrary.8


In August 2016, certain employees filed separate individual arbitration claims against their employer, 20/20 Communications, but later amended the claims to assert identical class claims. 20/20 Communications, a national direct-sales and marketing company, requires as a condition of employment that its field sales managers sign the company's arbitration agreement, which contains a class arbitration bar under which employees agree not to bring class or collective actions to arbitration.

After the filing of the complaints, the company sought a declaration in the District Court for the Northern District of Texas that the issue of class arbitrability is a "gateway issue" for the court rather than the arbitrator to decide, and that the class arbitration bar provision in the employment agreements prevented class arbitration.9 The District Court denied this declaration. Also during these District Court proceedings, one of the individual arbitrators issued a clause construction award, concluding that the class arbitration bar was unenforceable under the National Labor Relations Act.10 The company filed a new action in the District Court to vacate that award, and the District Court denied the motion. The Court of Appeals for the Fifth Circuit consolidated both actions for the purpose of appeal.


The Fifth Circuit reversed and vacated the District Court rulings, holding that there is a presumption that the threshold question of class arbitrability is for courts, not arbitrators, to decide. The court explained that because class actions are conducted on behalf of and bind absent class members, they raise important due process concerns that must be evaluated by a court. For example, due process requires that absent class members "be afforded notice, an opportunity to be heard, and a right to opt out of the class," which is achieved through open litigation and not private arbitration. Additionally, other differences between privacy and confidentiality in arbitration and litigation must also be considered by courts. Having decided that courts must determine arbitrability, the Fifth Circuit further held that the arbitration agreement at issue barred class arbitrations and foreclosed any suggestion that the parties had intended the question of arbitrability to be decided by an arbitrator. The court acknowledged that, when taken in isolation, three provisions in the agreement that vested the arbitrator with general powers (specifically, to resolve disputes related to  the formation of the agreement, to administer  the arbitration according to the AAA except where the agreement governed and to determine all disputes except as provided in the agreement) could arguably be construed to authorize arbitrators to decide the issue of arbitrability. However, the second and third provisions contained exceptions with reference to the agreement and, compared with the class arbitration bar in the agreement, none of the provisions had "clear and unmistakable" language empowering arbitrators to decide arbitrability, nor did they speak with specificity to the matter of class arbitration. Thoughts & Takeaways Although the Supreme Court has not decided whether class arbitrability is a gateway issue, the Fifth Circuit's opinion joined the Fourth, Sixth, Seventh, Eighth, Ninth and Eleventh Circuits in holding that the availability of class or collective arbitration is a threshold question of arbitrability that must be decided by a court.11 It will be interesting to see whether and how the other circuits will weigh in on this issue. Read the decision here.

To view the full article click here


1 Dynamex Ops. W. Inc. v. Superior Court, 416 P.3d 1 (Cal. 2018).

2 Roman v. Jan-Pro Franchising Int'l, Inc., No. 16-05961 WHA, 2017 WL 2265447 (N.D. Cal. May 24, 2017).

3 See Depianti v. Jan-Pro Franchising Int'l, Inc., 873 F.3d 21 (1st Cir. 2017).

4 Dynamex, 416 P.3d at 7.

5 Vazquez v. Jan-Pro Franchising Int'l, Inc., 923 F.3d 575 (9th Cir. 2019).

6 Vazquez v. Jan-Pro Franchising Int'l, Inc., No. 17-16096, 2019 WL 3271969 (9th Cir. July 22, 2019).

7 Renewed Petition for a Writ of Mandamus, Logitech Inc. v. U.S. Dist. Ct. for the N. Dist. of Cal., No. 19-70248 (9th Cir. Jan. 25, 2019), ECF No. 1-1.

8 20/20 Commc'ns, Inc. v. Crawford, No. 18-10260, 2019 WL 3281412 (5th Cir. July 22, 2019).

9 20/20 Commc'ns, Inc. v. Blevins, 357 F.Supp.3d 566 (N.D. Tex. 2019) ("Blevins").

10 20/20 Commc'ns, Inc. v. Crawford, No. 17-cv-929, 2018 WL 1135658 (N.D. Tex. Feb. 28, 2018) ("Crawford").

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.

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.

Similar Articles
Relevancy Powered by MondaqAI
Cleary Gottlieb Steen & Hamilton LLP
Skadden, Arps, Slate, Meagher & Flom (UK) LLP
In association with
Related Topics
Similar Articles
Relevancy Powered by MondaqAI
Cleary Gottlieb Steen & Hamilton LLP
Skadden, Arps, Slate, Meagher & Flom (UK) LLP
Related Articles
Related Video
Up-coming Events Search
Font Size:
Mondaq on Twitter
Mondaq Free Registration
Gain access to Mondaq global archive of over 375,000 articles covering 200 countries with a personalised News Alert and automatic login on this device.
Mondaq News Alert (some suggested topics and region)
Select Topics
Registration (please scroll down to set your data preferences)

Mondaq Ltd requires you to register and provide information that personally identifies you, including your content preferences, for three primary purposes (full details of Mondaq’s use of your personal data can be found in our Privacy and Cookies Notice):

  • To allow you to personalize the Mondaq websites you are visiting to show content ("Content") relevant to your interests.
  • To enable features such as password reminder, news alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our content providers ("Contributors") who contribute Content for free for your use.

Mondaq hopes that our registered users will support us in maintaining our free to view business model by consenting to our use of your personal data as described below.

Mondaq has a "free to view" business model. Our services are paid for by Contributors in exchange for Mondaq providing them with access to information about who accesses their content. Once personal data is transferred to our Contributors they become a data controller of this personal data. They use it to measure the response that their articles are receiving, as a form of market research. They may also use it to provide Mondaq users with information about their products and services.

Details of each Contributor to which your personal data will be transferred is clearly stated within the Content that you access. For full details of how this Contributor will use your personal data, you should review the Contributor’s own Privacy Notice.

Please indicate your preference below:

Yes, I am happy to support Mondaq in maintaining its free to view business model by agreeing to allow Mondaq to share my personal data with Contributors whose Content I access
No, I do not want Mondaq to share my personal data with Contributors

Also please let us know whether you are happy to receive communications promoting products and services offered by Mondaq:

Yes, I am happy to received promotional communications from Mondaq
No, please do not send me promotional communications from Mondaq
Terms & Conditions

Mondaq.com (the Website) is owned and managed by Mondaq Ltd (Mondaq). Mondaq grants you a non-exclusive, revocable licence to access the Website and associated services, such as the Mondaq News Alerts (Services), subject to and in consideration of your compliance with the following terms and conditions of use (Terms). Your use of the Website and/or Services constitutes your agreement to the Terms. Mondaq may terminate your use of the Website and Services if you are in breach of these Terms or if Mondaq decides to terminate the licence granted hereunder for any reason whatsoever.

Use of www.mondaq.com

To Use Mondaq.com you must be: eighteen (18) years old or over; legally capable of entering into binding contracts; and not in any way prohibited by the applicable law to enter into these Terms in the jurisdiction which you are currently located.

You may use the Website as an unregistered user, however, you are required to register as a user if you wish to read the full text of the Content or to receive the Services.

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 or with the prior written consent of Mondaq. You may not use electronic or other means to extract details or information from the Content. Nor shall you extract information about users or Contributors in order to offer them any services or products.

In your use of the Website and/or Services you shall: comply with all applicable laws, regulations, directives and legislations which apply to your Use of the Website and/or Services in whatever country you are physically located including without limitation any and all consumer law, export control laws and regulations; provide to us true, correct and accurate information and promptly inform us in the event that any information that you have provided to us changes or becomes inaccurate; notify Mondaq immediately of any circumstances where you have reason to believe that any Intellectual Property Rights or any other rights of any third party may have been infringed; co-operate with reasonable security or other checks or requests for information made by Mondaq from time to time; and at all times be fully liable for the breach of any of these Terms by a third party using your login details to access the Website and/or Services

however, you shall not: do anything likely to impair, interfere with or damage or cause harm or distress to any persons, or the network; do anything that will infringe any Intellectual Property Rights or other rights of Mondaq or any third party; or use the Website, Services and/or Content otherwise than in accordance with these Terms; use any trade marks or service marks of Mondaq or the Contributors, or do anything which may be seen to take unfair advantage of the reputation and goodwill of Mondaq or the Contributors, or the Website, Services and/or Content.

Mondaq reserves the right, in its sole discretion, to take any action that it deems necessary and appropriate in the event it considers that there is a breach or threatened breach of the Terms.

Mondaq’s Rights and Obligations

Unless otherwise expressly set out to the contrary, nothing in these Terms shall serve to transfer from Mondaq to you, any Intellectual Property Rights owned by and/or licensed to Mondaq and all rights, title and interest in and to such Intellectual Property Rights will remain exclusively with Mondaq and/or its licensors.

Mondaq shall use its reasonable endeavours to make the Website and Services available to you at all times, but we cannot guarantee an uninterrupted and fault free service.

Mondaq reserves the right to make changes to the services and/or the Website or part thereof, from time to time, and we may add, remove, modify and/or vary any elements of features and functionalities of the Website or the services.

Mondaq also reserves the right from time to time to monitor your Use of the Website and/or services.


The Content is general information only. It is not intended to constitute legal advice or seek to be the complete and comprehensive statement of the law, nor is it intended to address your specific requirements or provide advice on which reliance should be placed. Mondaq and/or its Contributors and other suppliers make no representations about the suitability of the information contained in the Content for any purpose. All Content provided "as is" without warranty of any kind. Mondaq and/or its Contributors and other suppliers hereby exclude and disclaim all representations, warranties or guarantees with regard to the Content, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. To the maximum extent permitted by law, Mondaq expressly excludes all representations, warranties, obligations, and liabilities arising out of or in connection with all Content. In no event shall Mondaq 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 of the Content or performance of Mondaq’s Services.


Mondaq may alter or amend these Terms by amending them on the Website. By continuing to Use the Services and/or the Website after such amendment, you will be deemed to have accepted any amendment to these Terms.

These Terms shall be governed by and construed in accordance with the laws of England and Wales and you irrevocably submit to the exclusive jurisdiction of the courts of England and Wales to settle any dispute which may arise out of or in connection with these Terms. If you live outside the United Kingdom, English law shall apply only to the extent that English law shall not deprive you of any legal protection accorded in accordance with the law of the place where you are habitually resident ("Local Law"). In the event English law deprives you of any legal protection which is accorded to you under Local Law, then these terms shall be governed by Local Law and any dispute or claim arising out of or in connection with these Terms shall be subject to the non-exclusive jurisdiction of the courts where you are habitually resident.

You may print and keep a copy of these Terms, which form the entire agreement between you and Mondaq and supersede any other communications or advertising in respect of the Service and/or the Website.

No delay in exercising or non-exercise by you and/or Mondaq of any of its rights under or in connection with these Terms shall operate as a waiver or release of each of your or Mondaq’s right. Rather, any such waiver or release must be specifically granted in writing signed by the party granting it.

If any part of these Terms is held unenforceable, that part shall be enforced to the maximum extent permissible so as to give effect to the intent of the parties, and the Terms shall continue in full force and effect.

Mondaq shall not incur any liability to you on account of any loss or damage resulting from any delay or failure to perform all or any part of these Terms if such delay or failure is caused, in whole or in part, by events, occurrences, or causes beyond the control of Mondaq. Such events, occurrences or causes will include, without limitation, acts of God, strikes, lockouts, server and network failure, riots, acts of war, earthquakes, fire and explosions.

By clicking Register you state you have read and agree to our Terms and Conditions