Dittman v. Medical Solution, L.L.C. ( 2022 )

1 2 3 4 5 6 7 8 UNITED STATES DISTRICT COURT 9 EASTERN DISTRICT OF CALIFORNIA 10 11 BRYON DITTMAN, No. 2:17-cv-01851-MCE-CKD 12 Plaintiff, 13 v. ORDER 14 MEDICAL SOLUTION, L.L.C., 15 Defendant. 16 17 In October 2018, this Court issued an order certifying a California-wide class of 18 individuals pursuant to Federal Rule of Civil Procedure 23 and conditionally certifying a 19 nationwide collective action pursuant to the Fair Labor Standards Act (“FLSA”). ECF No. 20 39. The Rule 23 class was defined as follows: 21 All non-exempt hourly healthcare professionals employed by Medical Solutions who, at any time from September 7, 2013 22 through the date of certification, worked in California pursuant to a Travel Assignment Agreement during which they received 23 housing and/or meal and incidental benefits, received overtime pay, and had the value of their housing and/or meals and 24 incidental benefits excluded from their regular rate for purposes of calculating overtime pay. 25 Id. at 1. The FLSA collective action similarly consisted of: 26 All non-exempt hourly healthcare professionals employed by 27 Medical Solutions in the United States who, at any time within the three years preceding certification, worked pursuant to a 28 Travel Assignment Agreement during which they received 1 housing and/or meal and incidental benefits, worked in excess of 40 hours in one or more workweeks, and had the value of 2 their housing and/or meals and incidental benefits excluded from their regular rate for purposes of calculating overtime pay. 3 4 Id. at 1-2. 5 Since then, new facts have come to light that impact the veracity of these 6 definitions. Accordingly, the parties have filed additional motions regarding certification: 7 (1) Defendant filed a Motion to Decertify the Rule 23 Class and FLSA Collective Action 8 and Strike Plaintiff’s PAGA Claim (ECF No. 91); and (2) Plaintiff filed a Motion to Amend 9 Certification Order (ECF No. 93). According to Defendant, certification is improper 10 because: 11 (i) plaintiff Dittman cannot represent class members who have signed arbitration agreements that contain a class action 12 waiver, (ii) plaintiff Dittman cannot represent individuals who were uninjured because they were paid as much as or more 13 than they would be owed if the value of the challenged per diems were included in the regular rate for purposes of 14 calculating overtime, (iii) the “function test” announced by the Ninth Circuit in Clarke v. AMN Services, LLC, 987 F.3d 848 15 (9th Cir. 2021) necessitates individualized inquiries that predominate as to whether each individual class member’s per 16 diem payments must be considered wages for purposes of calculating overtime or reimbursements of expenses incurred. 17 18 ECF No. 91 at 1. For his part, Plaintiff seeks modification of the certification order to: 19 (1) appoint Autumn Cobbs as an additional representative of the certified Rule 23 class; and (2) modify the certified Rule 23 20 class and FLSA collective [action] to exclude any individuals who were paid an overtime rate that was equal to or greater 21 than one and one-half times what their regular rate would have been had the value of their per diem benefits been included. 22 23 ECF No. 93 at 1. 24 The Court concludes that, as the record stands, certification is not currently 25 proper. It is not clear to the Court that Ms. Cobbs is an appropriate class representative 26 of employees that entered arbitration agreements containing class waivers. There is a 27 factual dispute as to whether her arbitration agreement extends to the instant litigation. 28 It also remains unclear how many putative class members actually may have suffered 1 | damages under Defendant's overtime policy. Finally, the Court is not convinced that any 2 | individual who entered an arbitration agreement with a class waiver would be able to 3 | represent anyone in this action because Defendant would no doubt move to compel 4 | arbitration as to any claims raised by such an individual. 5 While that would be enough for the Court to conclude that certification is 6 | improper, it is also unclear from the record whether the statutory certification 7 | prerequisites have been met given the presence of class members who were not injured 8 | by Defendant’s challenged practices. For example, the Court cannot determine whether 9 | individual questions regarding damages would predominate over common questions or 10 | how many putative class members actually may have suffered the requisite damages. 11 At base, the parties appear to agree that some members of the putative class are 12 | bound by arbitration agreements that include class waivers and that a number of the 13 || class members suffered no damages such that their claims are adverse to those set 14 | forth by the named Plaintiff. As constituted then, the class should not be certified. Nor 15 | has the Court been convinced that the amendments proffered by Plaintiff will sufficiently 16 | rectify the class deficiencies. Accordingly, Defendant’s Motion to Decertify the Rule 23 17 | Class and FLSA Collective and Strike Plaintiffs PAGA Claim (ECF No. 91) is GRANTED 18 | in part. Both the Rule 23 Class and FLSA Collective Action are hereby decertified 19 || without prejudice to Plaintiff filing a renewed certification motion addressing in detail the 20 | prerequisites set forth in Rule 23 and under the FLSA. The Court declines to strike 21 | Plaintiff's PAGA claim at this juncture. Plaintiff's Motion to Amend Certification Order 22 | (ECF No. 93) is DENIED without prejudice as moot. 23 IT IS SO ORDERED. 24 | Dated: July 21, 2022 25 J Lat LEK ee NK °° SENIOR UNITED STATES DISTRICT JUDGE 27 28