De Asencio v. Tyson Foods, Inc. , 342 F.3d 301 ( 2003 )

Opinions of the United
2003 Decisions States Court of Appeals
for the Third Circuit
9-8-2003
DeAsencio v. Tyson Foods Inc
Precedential or Non-Precedential: Precedential
Docket No. 02-3719
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PRECEDENTIAL
Filed September 8, 2003
UNITED STATES COURT OF APPEALS
FOR THE THIRD CIRCUIT
No. 02-3719
MELANIA FELIX DE ASENCIO;
MANUEL A. GUTIERREZ; ASELA RUIZ;
EUSEBIA RUIZ; LUIS A. VIGO; LUZ CORDOVA;
HECTOR PANTAJOS, ON BEHALF OF THEMSELVES
AND ALL OTHER SIMILARLY SITUATED INDIVIDUALS
v.
TYSON FOODS, INC.,
Appellant
On Appeal from the United States District Court
for the Eastern District of Pennsylvania
D.C. Civil Action No. 00-cv-04294
(Honorable Robert F. Kelly)
Argued April 24, 2003
Before: SCIRICA, Chief Judge,* AMBRO and
GARTH, Circuit Judges
(Filed September 8, 2003)
* Judge Scirica began his term as Chief Judge on May 4, 2003.
2
MICHAEL J. MUELLER, ESQUIRE
(ARGUED)
Akin, Gump, Strauss, Hauer & Feld
1333 New Hampshire Avenue, N.W.
Suite 400
Washington, D.C. 20036
Attorney for Appellant
FREDERICK P. SANTARELLI,
ESQUIRE (ARGUED)
THOMAS J. ELLIOTT, ESQUIRE
ERIC L. YOUNG, ESQUIRE
Elliott, Reihner, Siedzikowski
& Egan
925 Harvest Drive, Suite 300
Blue Bell, Pennsylvania 19422
Attorneys for Appellees
OPINION OF THE COURT
SCIRICA, Chief Judge.
In a labor dispute over unpaid wages, plaintiffs gained
certification of an opt-in class under the Fair Labor
Standards Act and then sought certification of a Fed. R.
Civ. P. 23(b)(3) opt-out class under the Pennsylvania Wage
Payment & Collection Law. The District Court granted the
Rule 23 certification. At issue is whether the District Court
should have exercised supplemental jurisdiction over the
state-law class under 28 U.S.C. § 1367.
I.
A.
Plaintiffs are hourly employees at defendant Tyson Foods’
two chicken-processing plants in New Holland,
Pennsylvania (Lancaster County). Plant One employees
work on the production line slaughtering birds and
producing meat for direct sale or further processing. Those
3
at Plant Two process the chicken meat, producing
prepared, packed chicken products, like chicken nuggets,
chicken tenders, chicken patties, and Buffalo wings.
Animal flesh, blood, and fecal matter are present
throughout both plants. To protect against disease and
safety hazards, Tyson employees are required to perform
“donning, doffing, and sanitizing” activities. This entails
putting on protective clothing—like hairnets, earplugs,
safety goggles, cotton smocks, gloves, and plastic aprons—
before the start of their shift, and rinsing their clothing and
washing their hands at the end of their shift. Employees
receive two unpaid 30-minute meal periods per shift, and
must don, doff, and sanitize at the beginning and end of
these breaks.1
Tyson ordinarily does not pay its employees for time
spent donning and doffing.2 The plaintiff employees are not
organized nor do they work under a written contract. There
is no collective bargaining.
B.
In August 2000, plaintiffs filed suit against Tyson under
both federal law (the Fair Labor Standards Act, 29 U.S.C.
§§ 201-219) and state law (the Pennsylvania Wage Payment
& Collection Law, 43 P.S. §§ 260.1-260.45) on behalf of
themselves and similarly situated co-workers at Tyson’s
chicken processing complex.
On October 4, plaintiffs sought collective treatment of
their FLSA action under the federal statute’s opt-in
provisions. 29 U.S.C. § 216(b) (“[N]o employee shall be a
party plaintiff to any such action unless he gives his
consent in writing to become such a party and such
consent is filed in the court in which such action is
1. Tyson cites significant differences among its hourly employees,
contending they wear different clothing, resulting in time variations for
donning and doffing. The parties agree there are at least four categories
under which Tyson calculates employee working times, depending on the
type of work and where they work on the production line.
2. Tyson pays for donning and doffing in two limited instances, which are
not relevant here.
4
brought.”). Plaintiffs did not seek class certification on the
state-law WPCL action at that time.
On January 31, 2001, the District Court granted
plaintiffs’ request to issue notice to prospective class
members under the FLSA action. The court’s notice stated,
in part, “The Court has not yet determined that the claims
under the Pennsylvania WPCL can be pursued as a class
action, and thus your right to participate in that claim will
depend on a later decision by the Court.”
On March 15, Tyson mailed out the notice to 3,400
prospective FLSA class members. On June 21, Tyson filed
a motion to close the class period. At that time, 502 current
and former employees—or 15 percent of the allegedly
eligible class—had elected to join the FLSA action by filing
written consent forms. Plaintiffs contested the motion to
close, claiming that a substantial number of prospective
plaintiffs never received notice and that Tyson improperly
discouraged its current and former employees from
participating in the action. The record showed that 783
putative FLSA class members never received notice of the
opt-in action because Tyson mailed the notice to the wrong
address.3
On July 24, the District Court closed the class period
and denied plaintiffs’ motion to reissue notice. The class
consisted of 504 current and former employees. The
District Court later dismissed, on summary judgment, the
claims of 57 of those employees as barred by the statute of
limitations. All parties acknowledge that the current size of
the FLSA class is 447 persons.
On December 31, the District Court closed discovery.
Nearly two months later, on February 22, 2002, plaintiffs
filed a motion to certify the supplemental state-law WPCL
action under Fed. R. Civ. P. 23. Plaintiffs’ motion for class
treatment under the supplemental state-law action was
filed 17 months after their motion to certify the federal
FLSA action. The District Court heard arguments on
3. Additional putative FLSA class members allegedly never received
notice of the opt-in class because they had not been employed by Tyson
at the time the notice was sent.
5
whether plaintiffs could bring a WPCL action because they
had not pleaded a contract claim, the predicate for a WPCL
action. On May 14, plaintiffs argued for the first time that
the WPCL action was grounded in an implied contract
between Tyson and its hourly employees.4
On July 17, despite Tyson’s objections that the WPCL
certification motion was late and that the implied contract
argument was new, the District Court granted plaintiffs’
motion to certify the state WPCL action under Fed. R. Civ.
P. 23(b)(3).5 The state-law class, an opt-out class, consisted
of approximately 4,100 persons, including approximately
700 employees hired after notice was sent to the FLSA
class.
The District Court had subject matter jurisdiction over
plaintiffs’ FLSA action under 28 U.S.C. § 1331 and
exercised supplemental jurisdiction over plaintiffs’ state-law
action under 28 U.S.C. § 1367. Tyson disputes the District
Court’s exercise of supplemental jurisdiction. Tyson
petitioned for leave to appeal the certification order under
Fed. R. Civ. P. 23(f), which was granted. We have
jurisdiction over the interlocutory appeal under 28 U.S.C.
§ 1292(e) and Fed. R. Civ. P. 23(f).
4. Tyson avers it has made no promise to pay its employees for donning
and doffing time.
5. The Pennsylvania Wage Payment & Collection Law provides:
Actions by an employe, labor organization, or party to whom any
type of wages is payable to recover unpaid wages and liquidated
damages may be maintained in any court of competent jurisdiction,
by such labor organization, party to whom any type of wages is
payable or any one or more employes for and in behalf of himself or
themselves and other employes similarly situated, or such employe
or employes may designate an agent or representative to maintain
such action or on behalf of all employes similarly situated. Any such
employe, labor organization, party, or his representative shall have
the power to settle or adjust his claim for unpaid wages.
43 P.S. § 260.9a(b).
6
II.
A.
In 1938, Congress enacted the Fair Labor Standards Act
to govern the maintenance of standard hour and wage
practices. The FLSA requires employers to pay their
employees at least a specified minimum hourly wage for
work performed, 29 U.S.C. § 206, and to pay one and one-
half times the employee’s regular rate of pay for hours
worked in excess of forty hours per week, 29 U.S.C. § 207.
Employers who violate these provisions are “liable to the
employee or employees affected in the amount of their
unpaid minimum wages, or their unpaid overtime
compensation, as the case may be, and in an additional
equal amount as liquidated damages.” 29 U.S.C. § 216(b).
The legislation propelled thousands of portal-to-portal
lawsuits. The term “portal to portal” represents an
employee’s work day from starting time to quitting time.
Jewell Ridge Coal Corp. v. United Mine Workers, 325 U.S.
161, 188 (1945) (Jackson, J., dissenting); Connors v. Beth
Energy Mines, Inc., 920 F.2d 205, 208 (3d Cir. 1990) (work
day was eight hours from portal-to-portal including thirty
minutes for lunch). Between July 1, 1946 and January 31,
1947, employees around the country filed 1,913 such
actions under the FLSA. 93 Cong. Rec. 2,082 (1947).
The dramatic increase in these suits was a result of the
Supreme Court’s decision in Anderson v. Mount Clemens
Pottery Co., 328 U.S. 680 (1946), which expanded the scope
of compensable “working time” for FLSA purposes. See 93
Cong. Rec. 2,089 (1947) (“[W]hat is the cause of this
widespread litigation? The immediate incident which
apparently brought this vast flood of litigation upon our
nation was the decision of the Supreme Court [in
Anderson].”). Responding to this increase in litigation,
Congress sought “to define and limit the jurisdiction of the
courts” through the Portal-to-Portal Act, Pub. L. No. 80-49,
ch. 52, § 1(b)(3), 61 Stat. 85 (1947). 93 Cong. Rec. 2,087
(1947) (“[T]he attention of the Senate is called to a dramatic
influx of litigation, involving vast alleged liability, which has
suddenly entered the Federal courts of the Nation.”). Noting
7
the “immensity of the [litigation] problem,” id. at 2,082,
Congress attempted to strike a balance to maintain
employees’ rights but curb the number of lawsuits. Under
the Portal-to-Portal Act, an FLSA action for overtime pay
could be maintained by “one or more employees for and in
behalf of himself or themselves and other employees
similarly situated.” 29 U.S.C. § 216(b). But the statute
contained an express opt-in provision: “No employee shall
be a party plaintiff to any such action unless he gives his
consent in writing to become such a party and such
consent is filed in the court in which such action is
brought.” Id.Because the Portal-to-Portal Act amendment changed
participation in an FLSA class from “opt-out” to “opt-in,”
FLSA plaintiffs could not certify a class under Fed. R. Civ.
P. 23, even though federal subject matter jurisdiction
obtained. E.g., Lusardi v. Lechner, 855 F.2d 1062, 1068 n.8
(3d Cir. 1988) (“Courts have generally recognized that Rule
23 class actions may not be used under FLSA § 16(b).”); 5
James Wm. Moore et al., Moore’s Federal Practice § 23.06[1]
(3d ed. 2003) (“Rule 23 is inapplicable to class proceedings
under the FLSA.”). The principal difference between FLSA
class actions and Fed. R. Civ. P. 23 class actions is that
prospective plaintiffs under the FLSA must consent to join
the class.
As noted, plaintiffs here obtained federal court
jurisdiction when they filed a FLSA action, alleging that
Tyson was liable to pay its employees for time spent
donning and doffing. The District Court ordered notice to
prospective class members and later certified a class of 504
persons who consented in writing to become party plaintiffs.6
The certification of this class is not problematic. But Tyson
contends plaintiffs obtained federal jurisdiction, then used
their supplemental state-law WPCL action and Fed. R. Civ.
P. 23’s opt-out provisions as an end run around the Portal-
6. As noted, the current number of eligible plaintiffs in the FLSA class is
447.
8
to-Portal Act’s clear congressional mandate in favor of
collective opt-in actions.7
B.
At issue is whether the District Court properly exercised
supplemental jurisdiction over the state-law WPCL opt-out
action.
In 1990, Congress broadened district courts’ ability to
exercise supplemental jurisdiction over non-federal claims.
28 U.S.C. § 1367.8 The statute explicitly provided for
7. Plaintiffs argue Congress did not intend the Portal-to-Portal Act
amendments to affect state-law actions. They cite legislative history that
“[a]ctions under the common law, or under State statutes for recovery of
wages are not affected” by the Act. H.R. Rep. No. 71 (1947), reprinted in
1947 U.S.C.C.A.N. 1029, 1035. But plaintiffs’ reference to the legislative
history is misplaced. The cited statement pertained directly to the Act’s
imposition of a one-year statute of limitations on FLSA actions. See
Univs. Research Ass’n v. Coutu, 450 U.S. 754, 781 n.34 (1981) (“Senator
McGrath’s statement strongly suggests that the limitations period of the
Portal-to-Portal Act was designed to apply to the explicit statutory
remedy set forth in the Davis-Bacon Act.”). It did not coincide with the
Act’s provision that requires parties’ consent to a collective action.
8. 28 U.S.C. § 1367(a-c) provides:
(a) Except as provided in subsections (b) and (c) or as expressly
provided otherwise by Federal statute, in any civil action of which the
district courts have original jurisdiction, the district courts shall have
supplemental jurisdiction over all other claims that are so related to
claims in the action within such original jurisdiction that they form part
of the same case or controversy under Article III of the United States
Constitution. Such supplemental jurisdiction shall include claims that
involve the joinder or intervention of additional parties.
(b) In any civil action of which the district courts have original
jurisdiction founded solely on section 1332 of this title, the district
courts shall not have supplemental jurisdiction under subsection (a) over
claims by plaintiffs against persons made parties under Rule 14, 19, 20,
or 24 of the Federal Rules of Civil Procedure, or over claims by persons
proposed to be joined as plaintiffs under Rule 19 of such rules, or
seeking to intervene as plaintiffs under Rule 24 of such rules, when
exercising supplemental jurisdiction over such claims would be
inconsistent with the jurisdictional requirements of section 1332.
9
supplemental jurisdiction for “claims that involve the
joinder or intervention of additional parties.” Id.9
Supplemental jurisdiction was not available where
“expressly provided otherwise by Federal statute” or under
one of the statute’s enumerated exceptions. Id.Section 1367 combined older notions of pendent
jurisdiction and ancillary jurisdiction. Under the statute,
which codified many of the principles enunciated in United
Mine Workers v. Gibbs, 383 U.S. 715, 725 (1966), a district
court may exercise supplemental jurisdiction where state-
law claims share a “common nucleus of operative fact” with
the claims that supported the district court’s original
jurisdiction. Id.; see also 28 U.S.C. § 1367(a); Krell v.
Prudential Ins. Co. of Am. (In re Prudential Ins. Co. Am.
Sales Practice Litig. Agent Actions), 148 F.3d 283, 303 (3d
Cir. 1998) (Section 1367 “does not permit courts to take
jurisdiction over tangentially related claims. The issue is
whether there is a ‘common nucleus of operative fact’ and
whether the claims are part of the ‘same case or
controversy under Article III.’ ”). Supplemental jurisdiction
promotes “judicial economy, convenience and fairness to
litigants.” Gibbs, 383 U.S. at 726.
Under section 1367, a district court has authority to
exercise supplemental jurisdiction over non-federal claims
(c) The district courts may decline to exercise supplemental
jurisdiction over a claim under subsection (a) if—
(1) the claim raises a novel or complex issue of State law,
(2) the claim substantially predominates over the claim or claims
over which the district court has original jurisdiction,
(3) the district court has dismissed all claims over which it has
original jurisdiction, or
(4) in exceptional circumstances, there are other compelling
reasons for declining jurisdiction.
9. Moreover, the Federal Rules of Civil Procedure permit joinder where
parties asserted “any right to relief . . . and if any question of law or fact
common to all these persons will arise in the action.” Fed. R. Civ. P.
20(a).
10
arising from the same case or controversy as the federal
claim. Here, the District Court determined the FLSA and
WPCL actions arose from the same controversy and shared
a common nucleus of operative fact. This ruling was not an
abuse of discretion. Where “the same acts violate parallel
federal and state laws, the common nucleus of operative
facts is obvious.” Lyon v. Whisman, 45 F.3d 758, 761 (3d
Cir. 1995). The FLSA and WPCL are parallel federal and
state laws and the independent actions both address
whether Tyson’s employees should be paid for donning and
doffing time, sufficiently demonstrating a common nucleus
of operative fact.
Still, section 1367 provides specific exceptions to
supplemental jurisdiction. There is no supplemental
jurisdiction where a federal statute expressly provides
otherwise, either through direct preclusion or preemption of
state-law claims.10 28 U.S.C. § 1367(a).11 There are also
explicit circumstances under which a district court may
decline to exercise supplemental jurisdiction. 28 U.S.C.
§ 1367(c). At issue is whether this case involves one of
those circumstances.
A district court has the responsibility to manage complex
litigation. That responsibility requires a court to determine
10. In certain federal statutes, Congress has expressly provided for the
preemption of state-law claims. E.g., Airline Deregulation Act of 1978, 49
U.S.C. § 41713(b)(1). But Congress did not do so here.
11. Moreover, although not relevant here, federal courts do not have
subject-matter jurisdiction over certain pendent state-law claims where
original jurisdiction is based on diversity rather than a federal question:
In any civil action of which the district courts have original
jurisdiction founded solely on section 1332 of this title, the district
courts shall not have supplemental jurisdiction under subsection (a)
over claims by plaintiffs against persons made parties under Rule
14, 19, 20, or 24 of the Federal Rules of Civil Procedure, or over
claims by persons proposed to be joined as plaintiffs under Rule 19
of such rules, or seeking to intervene as plaintiffs under Rule 24 of
such rules, when exercising supplemental jurisdiction over such
claims would be inconsistent with the jurisdictional requirements of
section 1332.
28 U.S.C. § 1367(b).
11
whether to exercise supplemental jurisdiction over pendent
claims and parties. In enacting section 1367, Congress
intended to enhance a district court’s ability to gain
jurisdiction over pendent claims and parties while providing
those courts with the discretion to decline to exercise
supplemental jurisdiction in several express circumstances.
“It has consistently been recognized that pendent
jurisdiction is a doctrine of discretion, not of plaintiff ’s
right.” Gibbs, 383 U.S. at 726.
Because the FLSA does not expressly address
supplemental jurisdiction, we consider the explicit statutory
circumstances enunciated in section 1367(c) under which a
district court may decline to exercise supplemental
jurisdiction. In codifying much of Gibbs, Congress granted
district court judges discretion to determine whether to
exercise supplemental jurisdiction. 28 U.S.C. § 1367(c); see
also New Rock Asset Partners v. Preferred Equity
Advancements, Inc., 101 F.3d 1492, 1507 n.11 (3d Cir.
1996) (discretion in district court judges helps promote the
economical resolution of cases). District courts may decline
to exercise supplemental jurisdiction where:
(1) the claim raises a novel or complex issue of State
law,
(2) the claim substantially predominates over the
claim or claims over which the district court has
original jurisdiction,
(3) the district court has dismissed all claims over
which it has original jurisdiction, or
(4) in exceptional circumstances, there are other
compelling reasons for declining jurisdiction.
28 U.S.C. § 1367(c)(1-4).12
12. Subsection (3) is not relevant here since the District Court has not
dismissed the FLSA action. We do not reach subsection (4), although it
may be relevant. Congress provided that a District Court may decline to
exercise supplemental jurisdiction where “in exceptional circumstances,
there are other compelling reasons for declining jurisdiction.” 28 U.S.C.
§ 1367(c)(4).
12
The dispositive provision here appears to focus on
whether the state-law action substantially predominates
over the FLSA action. Where “the state issues substantially
predominate, whether in terms of proof, of the scope of the
issues raised, or of the comprehensiveness of the remedy
sought, the state claims may be dismissed without
prejudice and left for resolution to state tribunals.” Gibbs,
383 U.S. at 726. Generally, a district court will find
substantial predomination “where ‘a state claim constitutes
the real body of a case, to which the federal claim is only
an appendage’—only where permitting litigation of all
claims in the district court can accurately be described as
allowing a federal tail to wag what is in substance a state
dog.” Borough of W. Mifflin v. Lancaster, 45 F.3d 780, 789
(3d Cir. 1995) (citation omitted) (quoting Gibbs, 383 U.S. at
727).
Our inquiry here centers on the terms of proof and the
scope of the issues raised in the FLSA and WPCL actions.13
As we have held, the WPCL “ ‘does not create a right to
compensation . . . . [r]ather, it provides a statutory remedy
when the employer breaches a contractual obligation to pay
earned wages. The contract between the parties governs in
determining whether specific wages are earned.’ ” Antol v.
Esposto, 100 F.3d 1111, 1117 (3d Cir. 1996) (quoting
Weldon v. Kraft, Inc., 896 F.2d 793, 801 (3d Cir. 1990)).
Because Tyson’s employees do not work under an
employment contract or a collective bargaining agreement,
plaintiffs will have to establish the formation of an implied
oral contract between Tyson and its employees. Even then,
whether an implied contract may give rise to a claim under
the WPCL has never been addressed by the Pennsylvania
state courts and will require additional testimony and proof
to substantiate beyond that required for the FLSA action.14
13. There are some differences in the comprehensiveness of the federal
and state remedies as well since the FLSA remedy is only for overtime
pay and the WPCL remedy is broader. And, as discussed infra, the WPCL
claim may be dismissed without prejudice here and left for resolution to
state tribunals. These factors further support a finding of substantial
predomination by the WPCL claim under Gibbs, but our focus here is on
the terms of proof and scope of the issues raised.
14. A federal court could have subject matter jurisdiction over two
federal claims, one requiring opt-in and the other opt-out. For example,
13
Given the importance of the wage-protection legal scheme
in Pennsylvania, the scope of the state issues may
substantially predominate over the more straightforward
federal scheme.
Another countervailing interest in relegating the WPCL
claims here to state court is Congress’s express preference
for opt-in actions for the federal cause of action. Congress’s
interest in these matters is manifest. For policy reasons
articulated in the legislative history, Congress chose to limit
the scope of representative actions for overtime pay and
minimum wage violations.
But the interest in joining these actions is strong as well.
As noted, the actions share a common nucleus of operative
fact and they arise from the same case or controversy.
Moreover, joinder would permit the District Court to
efficiently manage the overall litigation. Were supplemental
jurisdiction not to obtain, and assuming the statute of
limitations has not run, plaintiffs could file the WPCL
action in state court and request an opt-out class on behalf
of themselves and “other employes similarly situated.” 43
P.S. § 260.9a(b).15
a federal employment discrimination action might be brought by a
plaintiff class that also maintains an FLSA overtime pay action against
their employer. But the outcome may be different where one of the
claims is based in state law. Federal courts are courts of limited
jurisdiction. Where a party seeks supplemental jurisdiction of a state-law
action, we will evaluate jurisdiction under the statutory principles of 28
U.S.C. § 1367.
15. Pennsylvania law provides for a modified opt-out class:
(a) Except as provided in subdivision (b) or as otherwise provided by
the court, in certifying a plaintiff class or subclass the court shall state
in its order that every member of the class is included unless by a
specified date a member files of record a written election to be excluded
from the class.
(b) If the court finds that
(1) the individual claims are substantial, and the potential
members of the class have sufficient resources, experience and
sophistication in business affairs to conduct their own litigation; or
14
As we analyze the different levels of proof required and
the relevant federal and state interests, the disparity in
numbers here gives us pause. In terms of the number of
plaintiffs, the sheer difference in numbers between the two
prospective classes, 447 as opposed to 4,100, may
constitute substantial predomination by the state WPCL
action under section 1367.
Generally, the distinction between opt-in and opt-out
classes is crucial. Under most circumstances, the opt-out
class will be greater in number, perhaps even exponentially
greater. Opt-out classes have numbered in the millions. See
In re Prudential, 148 F.3d at 289-90. The aggregation of
claims, particularly as class actions, profoundly affects the
substantive rights of the parties to the litigation. Notably,
aggregation affects the dynamics for discovery, trial,
negotiation and settlement, and can bring hydraulic
pressure to bear on defendants. The more aggregation, the
greater the effect on the litigation.
But the size of a prospective class is important for
another reason. Within the universe of possible claimants,
it determines how many prospective plaintiffs remain
outside the class structure who are able to bring their own
individual suits. A large class with few claimants with
viable claims remaining outside is more likely to result in a
resolution bringing “global peace.” Conversely, a smaller
class in relation to the universe of possible claimants,
usually the result of an opt-in structure, will leave open the
possibility of more suits, assuming these are actions that
can be maintained individually.
We do not tout the relative merits of either approach. For
our purposes, it is sufficient to note that mandating an opt-
(2) other special circumstances exist which are described in the
order,
the court may state in its order that a person shall not be a member of
the plaintiff class or subclass unless by a specified date the person files
of record a written election to be included in the class or subclass.
Pa. R. Civ. P. 1711.
15
in class or an opt-out class is a crucial policy decision.
Congress has selected an opt-in class for FLSA actions.16
Predomination under section 1367 generally goes to the
type of claim, not the number of parties involved. But the
disparity in numbers of similarly situated plaintiffs may be
so great that it becomes dispositive by transforming the
action to a substantial degree, by causing the federal tail
represented by a comparatively small number of plaintiffs
to wag what is in substance a state dog.
Within the section 1367(c) analysis, certain issues of
state law presented in the WPCL action also weigh heavily,
tilting the balance against the exercise of supplemental
jurisdiction. Pennsylvania courts have not addressed two
novel and complex questions of state law squarely
presented here: whether a WPCL action may rest on an
implied employment contract that relies on alleged oral
representations by Tyson managers; and whether the WPCL
pertains to at will, non-collective bargaining employees. The
need to resolve these issues, which are better left to the
Pennsylvania state courts, weighs in favor of declining
supplemental jurisdiction. 28 U.S.C. § 1367(c)(1).
Whether the allegations of an implied employment
contract run to the entire WPCL class is also in dispute and
would implicate the predominance inquiry of Fed. R. Civ. P.
23(b)(3). “In cases involving implied contracts of
employment, the litigant will be able to reach the jury only
if he can clearly show that he and the employer intended to
form a contract.” DiBonaventura v. Consolidated Rail Corp.,
539 A.2d 865, 868 (Pa. Super. Ct. 1988). Because the FLSA
claim does not require an intent to form a contract,
individual questions of implied contract formation with
respect to each member of the WPCL class might
conceivably predominate over the issues common to the
claims of the FLSA plaintiffs.
16. Similarly, Congress has selected an opt-in class for actions under the
Age Discrimination in Employment Act. See Sperling v. Hoffman-LaRoche,
Inc., 24 F.3d 463, 464 (3d Cir. 1994) (“Section 7(b) of ADEA expressly
borrows the opt-in class mechanism of section 16(b) of the Fair Labor
Standards Act of 1938.”). As noted, in the absence of contrary
congressional mandates, class actions in federal court are governed by
Fed. R. Civ. P. 23.
16
We review a district court’s exercise of supplemental
jurisdiction for abuse of discretion. See Lyon, 45 F.3d at
760 (“[I]t is possible that even if the district court had the
power to hear the supplemental claims, it abused its
discretion in doing so.”). In exercising supplemental
jurisdiction over the WPCL action here, the District Court
held that “adding extra class members alone, whose
interests will be represented by the named Plaintiffs, will
not make the state law claims predominate. Regardless of
the number of class members, the named plaintiffs will
represent all of those with an FLSA claim or a WPCL claim.”
De Asencio v. Tyson Foods, Inc., 2002 U.S. Dist. LEXIS
13038, at *16 (E.D. Pa. July 17, 2002).
But whether the same group of named plaintiffs
represent both the state and federal classes is not
dispositive under Gibbs. Instead, a court must examine the
scope of the state and federal issues, the terms of proof
required by each type of claim, the comprehensiveness of
the remedies, and the ability to dismiss the state claims
without prejudice to determine whether the state claim
constitutes the real body of the case. This necessarily is a
case-specific analysis. Here, the inordinate size of the state-
law class, the different terms of proof required by the
implied contract state-law claim, and the general federal
interest in opt-in wage actions suggest the federal action is
an appendage to the more comprehensive state action.
We also are mindful of the unique circumstances
surrounding this litigation. On August 22, 2000, plaintiffs
filed this suit. The complaint included both the FLSA and
WPCL causes of action. On October 4, 2000, plaintiffs
sought collective action treatment of their FLSA claim but
did not seek certification of a class on the WPCL claim. It
was not until nearly 17 months later, on February 22,
2002, after the District Court had closed the FLSA class
period and ended discovery, that plaintiffs filed a motion to
certify a class on the WPCL claim. Moreover, it was not
until May 14, 2002, that plaintiffs first raised their implied
contract theory to support the WPCL claim.
The way in which this suit evolved lends even greater
credence to the conclusion that certification of the state-law
class was plaintiffs’ second line of attack when the FLSA
17
opt-in period yielded a smaller than desired federal class.
This may be proper strategy where the state and federal
actions raise similar issues and require similar terms of
proof. But here, the state interest in whether plaintiffs may
prevail on an implied contract WPCL action is
disproportionately high.17
Accordingly, we find the District Court did not exercise
sound discretion in granting supplemental jurisdiction over
the WPCL action.18
III.
Of the approximately 3,400 FLSA notices that Tyson
mailed to current or former employees, nearly 800 of them
were “undeliverable” and “returned to sender” due to
incorrect addresses.19 The record also demonstrates that
17. In discussing amendments to 28 U.S.C. § 1367, the Federal Courts
Study Committee recommended: “In order to minimize friction between
state and federal courts . . . Congress should direct federal courts to
dismiss state claims if these claims predominate or if they present novel
or complex questions of state law, or if dismissal is warranted in the
particular case by considerations of fairness or economy.” Report of the
Federal Courts Study Committee, 47-48 (Apr. 2, 1990).
18. Consistent with our holding, we will deny certification of the WPCL
class with respect to all plaintiffs, including those who opted into the
FLSA class. Our decision does not necessarily preclude the exercise of
supplemental jurisdiction where all plaintiffs with state law claims have
opted into the FLSA class. See Alvarez v. IBP, Inc., 2003 U.S. App. LEXIS
15622 (9th Cir. Aug. 5, 2003). These matters are committed to the sound
discretion of the District Court. See 28 U.S.C. § 1367.
19. The Notice and Consent Form, written in English and Spanish, was
disseminated as follows:
(1) for existing workers who are class members, Tyson shall
insert the Notice and Consent Form with the workers’ next
paycheck, along with a postage paid envelope addressed to Plaintiffs’
counsel;
(2) for former workers who are class members, Tyson shall mail
immediately the Notice with Consent Form to the workers’ last
known addresses, along with a postage paid envelope addressed to
Plaintiffs’ counsel; and
(3) Tyson shall promptly file with the Court, and serve a copy to
Plaintiff ’s counsel, written certification confirming it has fully
complied with the Court’s Order including the date(s) that it
complied with the instant Order.
18
Tyson hired approximately 700 employees after it mailed
the notice, and those employees never received notice.
Nevertheless, the District Court closed the opt-in period
and denied plaintiffs’ motion to reissue notice to all
potential plaintiffs. The resulting number of 447 plaintiffs
represented approximately 11 percent of the then-eligible
class.
In class actions, courts have equitable powers to manage
the litigation in order to promote judicial economy and
fairness to litigants. In re Diet Drugs Prods. Liab. Litig., 282
F.3d 220, 232 (3d Cir. 2002) (noting the “equitable nature
of class action proceedings”); In re Orthopedic Bone Screw
Prods. Liab. Litig, 246 F.3d 315, 321 (3d Cir. 2001)
(discussing a court’s equitable powers to “manage” class
action litigation). For this reason, we direct the District
Court to reopen the FLSA opt-in period for a reasonable
period of time to allow additional notice to all eligible
current and former employees. Tyson should make all
reasonable efforts to provide notice to these potential class
members.
IV.
For the foregoing reasons, we will reverse the judgment of
the District Court and remand for proceedings consistent
with this opinion.
A True Copy:
Teste:
Clerk of the United States Court of Appeals
for the Third Circuit