United States District Court, W.D. Missouri, Joseph Division
ALBERT J. ASTARITA, DIANA M. OWENS, Plaintiffs,
MENARD, INC., Defendant.
ORDER GRANTING IN PART AND DENYING IN PART
DEFENDANT'S MOTION FOR AN EMERGENCY STAY AND FOR LEAVE TO
ROSEANN A. KETCHMARK, UNITED STATES DISTRICT JUDGE.
the Court is Defendant Menard Inc's
(“Menard's”) motion for an emergency stay and
to certify the Court's November 8, 2019 Order for
interlocutory appeal. (Doc. 174.) For the reasons below, the
motion is GRANTED in part and DENIED
in part. Specifically, a certificate of
appealability is DENIED, but a stay is
GRANTED pending a decision by the Eighth
Circuit on Menards' forthcoming writ petition.
Second Amended Complaint in this case alleges that Defendant
Menard, Inc. (“Menard”) violated the Fair Labor
Standards Act (“FLSA”) and state law by failing
to pay employees for participating in its in-home training
program. (Doc. 78.) On March 6, 2018, Plaintiff Albert
Astarita moved for an injunction seeking (among other things)
to prohibit Menard from imposing arbitration agreements
containing class and collective action waivers on putative
class members. (Doc. 42 at 1-2.) During an injunction hearing
on April 6, 2018, Astarita refined his request: “All
we're asking for is a notification that anyone issued an
arbitration agreement there is pending litigation.”
(Doc. 115 at 38.) In opposition, Menard assured the Court
that such a notice was unnecessary at that time because,
assuming the Court were to eventually approve a class notice,
“there could be certainly appropriate explanatory
language about the arbitration issue.” (Doc. 115 at
38.) Based on Menard's representation, the Court denied
then did exactly what Astarita feared. The next month, on May
21, 2018, the Supreme Court handed down Epic Systems
Corporation v. Lewis, 138 S.Ct. 1612 (2018), which held
that the National Labor Relations Act (“NLRA”)
does not prohibit employers from enforcing class and
collective action waivers in general. Menard then began
inserting arbitration clauses containing class and collective
action waivers in its employment agreements for a particular
group of putative class members whose original employment
agreements did not contain waivers. In doing so, Menard did
not give these putative class members notice of this lawsuit;
inform them about the effect of the waiver on their ability
to participate in this case; or give them an opportunity to
opt out of the waiver. Menard also did not inform Plaintiff
Diana Owens's (“Plaintiff's”) counsel
that it did this until after the Court issued a class notice
that excluded those who signed waivers from the class
November 8, 2019, the Court authorized a corrective notice to
inform those who were required to sign revised employment
agreements containing waivers while this case was pending
that they can still join the action. (Doc. 173.) The Court
also ordered Menard to produce a Supplemental Class List
within three days. (Id.) On November 13, 2019,
Menard filed the present motion for an emergency stay and
certification for purposes of filing an interlocutory appeal.
(Doc. 174, 175.) The same day, the Court temporarily stayed
Defendant's deadline to produce the Supplemental Class
List in order to preserve the status quo. (Doc. 176.)
Menard's motion is now before the Court.
may appeal an interlocutory order under 28 U.S.C. §
1292(b) if it obtains both a certification from this Court
and permission from the Eighth Circuit. To certify an order
for interlocutory appeal, the Court must conclude “that
such order involves a controlling question of law as to which
there is substantial ground for difference of opinion and
that an immediate appeal from the order may materially
advance the ultimate termination of the litigation.” 28
U.S.C. § 1292(b).
there is no substantial ground for difference of opinion that
a supplemental class notice is necessary to correct
Menard's improper contacts with putative class members.
During the injunction hearing, Menard assured the Court that
an order informing putative class members about this case was
unnecessary at that stage of the proceedings because the
arbitration issue could be explained in a class notice.
Menard then proceeded to impose arbitration agreements on a
particular group of putative plaintiffs that (if enforceable)
would prohibit them from participating in this case. Menard
did this without giving them notice about the case; informing
them of how the waiver would affect their ability to
participate in this case; and providing an opportunity to opt
out of the waiver. Menard then remained silent about this
when the time came to issue a class notice, and it failed to
include this group of people on the original class list it
produced to Plaintiff.
argues that the Court was incorrect to issue a corrective
notice because arbitration contracts containing class and
collective action waivers are “presumptively”
enforceable, so anyone who signed such an agreement,
regardless of the circumstances, should not be allowed to
join the case. Menard fails to acknowledge, however, that
these agreements may be unenforceable due to the timing and
the manner of their imposition. See Balasanyan v.
Nordstrom, Inc., Nos. 11-cv-2609-JM-WMC,
10-CV-2671-JM-WMC, 2012 WL 760566, at *2-4 & nn.2-3 (S.D.
Cal. Mar. 8, 2012) (refusing to compel arbitration for
failure to give notice about the lawsuit); Jimenez v.
Menzies Aviation Inc., No. 15-CV-02392-WHO, 2015 WL
4914727, at *5-6 (N.D. Cal. Aug. 17, 2015) (refusing to
compel arbitration for failure to give notice about the
effect of the waiver and clear opportunities to opt out).
also argues that the Court “did not explain why an
employer must provide this information in the first
place.” (Doc. 175 at 12.) Menard is incorrect. The
Court explained that these disclosures are necessary because
“[e]mployees have a right to make an informed choice as
to whether to participate in an FLSA collective
action.” (Doc. 173 at 4 (quoting Rogers v.
WEBstaurant Store, Inc., No. 4:18-cv-00074-JHM, 2018 WL
3058882, at *6 (W.D. Ky. June 20, 2018)); see also
Hoffmann-La Roche Inc. v. Sperling, 493 U.S. 165, 174
(1989) (employees must be given notice “so that they
can make informed decisions about whether to
participate”); Billingsley v. Citi Trends,
Inc., 560 Fed.Appx. 914, 924 (11th Cir. 2014)
(“unsupervised, unilateral communications with . . .
potential plaintiffs can sabotage the goal of the FLSA's
informed consent requirement . . . .”). It is
undisputed that Menard imposed the waivers while the case was
pending and without notice about the case, notice about the
effect of the waiver, or an opportunity to opt out of the
cases cited by Menard do not address the issue that was
before this Court in its November 8 Order. Those cases
address whether a class notice should be sent to potential
plaintiffs even though, prior to the lawsuit, they had
executed binding arbitration agreements. Compare In re
JPMorgan Chase & Co., 916 F.3d 494, 498 (5th Cir.
2019) (they should not be given notice); and Dietrich v.
C.H. Robinson Worldwide, Inc., No. 18-C-4871 (N.D. Ill.
Mar. 20, 2019) (same); with Bigger v. Facebook,
Inc., 375 F.Supp.3d 1007, 1025 (N.D. Ill. 2019) (they
should be given notice), interlocutory appeal
granted, No. 19-1944 (7th Cir. 2019). Unlike those
cases, the Court in this case was not tasked in the November
8 Order with deciding whether to give notice to all potential
plaintiffs who had executed valid arbitration contracts prior
to the filing of the lawsuit. The Court had already decided
that issue in favor of Menard-in the original class
definition, the Court expressly excluded people whose
employment agreements contained a class or collective action
waiver. (Doc. 118 at 3.) In the November 8 Order, the Court
was tasked with deciding whether a corrective notice was
necessary for a select group of putative class members who
were never given notice of this lawsuit because Menard
improperly imposed waivers on them while this case was
pending. JPMorgan Chase, Dietrich, and
Bigger, do not address this issue.
there is no substantial ground for difference of opinion that
a corrective notice is necessary in this case, the Court ...