Category: In the News - Page 16

Several legal fights that will dominate the rest of 2024 are variations on the debate around who has the power to make and change laws and who is considered an employee, with the cases challenging the breadth of the U.S. Department of Labor’s rulemaking authority in the spotlight.

From multiple challenges to the DOL’s overtime and independent contractor rules to an imminent opinion on the fate of California’s Prop 22 and a Supreme Court case on the overtime exemption burden of proof, here are seven cases to watch in the latter half of the year.

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Burden of Proof on Overtime Exemptions

In a civil case concerning whether a worker is correctly classified as overtime exempt, the employer has the burden of proof. The question now before the U.S. Supreme Court is whether that burden is a preponderance of the evidence or, instead, clear and convincing.

The Fourth Circuit’s July 2023 opinion found that an employer, in this case a supermarket distributor, needed to show clear and convincing evidence to establish an exemption, a higher bar that is widely acknowledged to be out of step with sister circuits.

In fact, the U.S. Departments of Labor and Justice in an amicus brief urged the high court to simply summarily reverse the opinion.

That suggestion, interestingly, was ignored, said Christine Webber, a partner with worker side firm Cohen Milstein Sellers & Toll PLLC and co-chair of its civil rights and employment practice.

“There may be interest in having the [Supreme Court] address the burden of proof for establishing exemptions more broadly than a summary reversal would permit,” she said, “or, less likely, that there is support for the Fourth Circuit’s standard.”

The case is E.M.D. Sales Inc. et al. v. Carrera et al., case number 23-217, in the Supreme Court of the United States.

A New York federal judge has granted the first green light to a $46 million settlement in long-running multidistrict litigation over an alleged plot by several major U.S. and European banks, including Bank of America, JPMorgan Chase & Co. and Deutsche Bank AG, to limit market competition over interest rate swaps.

U.S. District Judge J. Paul Oetken issued an order Thursday granting preliminary approval to the deal and certifying a class of all individuals and entities who directly, or through an agent, entered into one or more Internal Revenue Service transactions with any of the defendants between Jan. 1, 2008, and June 10, 2024.

Judge Oetken also named Quinn Emanuel Urquhart & Sullivan LLP and Cohen Milstein Sellers & Toll PLLC as class counsel, along with the Public School Teachers’ Pension and Retirement Fund of Chicago and the Los Angeles County Employees Retirement Association as class representatives.

The plaintiffs told the court last month that a deal has been reached, bringing the total value of settlements reached in the action to $71 million.

A three-judge panel for the U.S. Court of Appeals for the Seventh Circuit denied CITGO Petroleum Corp.’s motion to appeal former employees’ class certification last week in a move that could lead the gas and energy giant to trial over allegations that it underpaid pension plans by upward of $31 million.

Circuit Judges Frank H. Easterbrook, David F. Hamilton and John Z. Lee filed the order July 3, denying CITGO’s petition to appeal under Federal Rule of Civil Procedure 23(f). While the panel did not details its reasoning for denying CITGO’s motion, a potential settlement could be on the horizon as District Judge Matthew F. Kennelly for the Northern District of Illinois has set a hearing for later this week to discuss the possibility of a settlement between the parties.

“Thousands of Citgo retirees have been adversely impacted by Citgo’s underpayment of pension benefits,” Yau said. “We are excited to try the case in early November.”

Brown, who took on the role of managing partner earlier this year succeeding Steven Toll in the post, said the firm is full of “mission-driven superachievers who believe in their case.”

Meet Benjamin Brown, who this year became the managing partner at Cohen Milstein Sellers & Toll—a role previously occupied by name partner Steven Toll. Brown, who is based in Washington, D.C. also co-chairs the firm’s antitrust practice. He shared Litigator of the Week honors earlier this year with his fellow co-lead counsel in an antitrust case that yielded a $418 million settlement with the National Association of Realtors. As part of the settlement, NAR agreed to implement changes reshaping how residential real estate commissions are handled in the U.S.

Lit Daily: Tell us a little about yourself—perhaps even a thing or two your partners would be surprised to learn about you.

Ben Brown: If you were to look at my life from 50,000 feet, you would think I was always destined to be a lawyer. My grandfather was a lawyer, my father was a judge, my brother is a lawyer, and my wife is a lawyer. But I was really torn between becoming a lawyer or moving to L.A. and becoming a screenwriter and actor. I decided not to apply to any “safety” schools for law. I was either going to go to the law school of my dreams or I was going to follow my other passion. I sometimes wonder how my life would have unfolded on the other path.

After clerking, I worked on the defense side for a few years, but the fit never felt right for me. I moved to DOJ and confirmed that I liked being on the left side of the “v” but I didn’t like the bureaucracy and having to defer to political appointees on the critical decisions. Finding Cohen Milstein validated my choice of a career in litigation. I get to litigate cases I care about and work alongside people I care about. I am very fortunate.

You took on the role of managing partner at the firm after name partner Steven Toll had long occupied that post. What tips did he have for you as you took on the job?

Steve isn’t the sort of guy who is going to play guru and closely guide the hand of a successor, especially since he still sits down the hall with an open door. But I learned a lot from watching him for years as a member of the firm’s executive committee. One lesson I took away from watching him was to trust my partners as litigators but offer help on the business and management side of the equation. Another lesson was to share credit and nudge others into the limelight. There are too many lawyers willing to push others out of the way to build their own reputations. One of the things that makes Cohen Milstein special is that we do not have that culture or reward that behavior. It makes the firm a genuinely collegial place to practice and is one reason we have very low turnover relative to most firms.

How have you balanced the demands of your own antitrust practice with your management duties?

To be honest, this is a work in progress. The short answer, though, is more delegation combined with longer hours. I have brought other talented partners into each of my cases to make sure that every case has multiple set of experienced eyes on the road and experienced hands on the wheel. That said, I’m not relegating myself to the back seat. I’ve continued to argue in court and take depositions. My plan is not to transition away from the front line—only to bring in reinforcements. On the firm management side, we have a terrific Executive Director of the firm in James Gehrke who keeps a lot of issues off my desk and without whom my plan to keep balancing both jobs would be impossible.

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What do you see as hallmarks of Cohen Milstein litigators? What makes you different?

Unlike most firms, Cohen Milstein is mission-driven. We embrace the role of the private attorney general and work to hold corporations accountable for misdeeds and overreach. It follows that attorneys attracted to Cohen Milstein are those who want to practice at the intersection of public interest and private enforcement. This career path really appeals to much of the current generation of law school graduates, which has afforded the firm a privileged position to hire attorneys with truly elite credentials and experience. Then, because our firm is highly specialized, those exceedingly well-credentialed attorneys gain deep experience in complex plaintiff-side litigation within their substantive area. That experience then informs our careful case selection. Thus, our firm is really a defendant’s worst nightmare—a deep bench of mission-driven superachievers who believe in their case and have become highly specialized to litigate precisely the type of case being litigated.

That formula leads to more successful outcomes in our litigations, which leads to an even stronger national reputation. This has allowed us to organically grow into one of the largest and most diversified plaintiff firms in the country without relying upon litigation funding. Having a national presence and industry-leading practice groups in 10 distinct areas affords us several competitive advantages.

Take, for example, our antitrust work addressing wage suppression. Our antitrust attorneys can call on our colleagues in our employment practice to consult on any thorny issues that implicate overlapping expertise. Our various antitrust wage suppression cases have resulted in over $700 million in settlements over the past two years. We can also litigate cutting-edge market manipulation cases. In our stock lending litigation, we leveraged the talent in both our antitrust and securities litigation practices. Settlements in that case total over $580 million so far. Another good example is the environmental tort work we’re handling on behalf of the residents of Flint, Michigan. This class action involving lead contamination in the city’s drinking water, resulting in more than $659.25 million in settlements thus far, was originally brought as a civil rights case. In each case, the diversity of our expertise has helped us achieve those monumental results and benefitted our clients tremendously.

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What were two or three of the firm’s biggest wins in the past year, and can you cite tactics that exemplify Cohen Milstein’s approach to success?

It may be my own bias as one of the co-leads, but I’ll first discuss Moehrl v. National Association of Realtors (N.D. Ill.). To reference my earlier comment, my colleague Robby Braun is our firm’s other steady hand on wheel in this case.

We are representing home sellers across the nation as co-lead class counsel in this case and three other, parallel class actions addressing an alleged price-fixing scheme in the real estate industry. Our clients, home sellers who listed their homes on multiple listing services (MLSs), claim that National Association of Realtors (NAR) and dozens of the nation’s largest real estate broker franchisors conspired to require home sellers to pay the fees for brokers representing the buyers of their homes, and to pay those fees at an inflated amount.

The case centers around NAR’s mandatory rule requiring brokers to make a blanket, non-negotiable offer of buyer broker compensation, called the “Buyer Broker Commission Rule,” when listing a property on an MLS. Our co-counsel successfully tried one of the parallel cases to a verdict of $1.8 billion pre-trebling.

Since October 2023, we have helped home sellers reach over $950 million in settlements, including a $418 million settlement against NAR this past March, along with sweeping injunctive relief that will significantly impact the real estate industry going forward. Additional settlement talks are ongoing.

This case exemplifies how our firm brings together the right legal talent to build and win cases. We were initially approached about this case by a Minnesota attorney named Doug Miller, who wasn’t an antitrust attorney or a class action litigator. We had to take his raw material and refine it into a winning theory and complaint. Then we approached Susman Godfrey and Hagens Berman, two of our regular partner firms, to build the right team to change an industry. Later, we all joined forces with a team of attorneys out of Missouri, including Mike Ketchmark who was the lead trial attorney at the Kansas City trial. This result was only made possible by bringing the right people together at the right time. Cohen Milstein’s size and stature in the plaintiff bar is reflected in our deep relationships with lawyers and firms across the country that allow us to identify, develop and win the big cases.

The second case would be In re Wells Fargo & Company Securities Litigation (S.D.N.Y.), where we helped our public pension fund clients achieve a $1 billion settlement in a massive securities fraud class action brought on behalf of investors nationwide. My colleague Laura Posner in our New York office helmed this one from start to finish, and Steve Toll helped lead the settlement negotiations.

The $1 billion settlement was not only the largest of its kind in 2023, the sixth largest in the last decade, the ninth largest ever in the Second Circuit, and the 17th largest ever, it is also the largest securities class action settlement—ever—without a restatement or related actions by the SEC or DOJ.

The lack of restatement is important because it makes the value of the recovery even more significant. In addition, the lack of preceding and parallel government enforcement actions, often the hallmark of a major private-sector securities class action, speaks to the risk our securities team took in pursuing the litigation and the exhaustive research and damages analyses the team undertook.

A unique hurdle the team faced was COVID-19. Wells Fargo argued that the stock drop, which occurred during the week the country started to shut down because of COVID-19, was caused by pandemic-related market turbulence, not the revelation of the bank’s fraud or misstatements about its (not) complying with federal consent orders. The court declined to dismiss the case on that ground. Less than three months after plaintiffs filed for class certification, the bank agreed to participate in settlement talks.

This case exemplified how our firm takes on smart risk. We do not wait for government action. We do thorough pre-filing investigations of our cases and we enter our litigations confident in our allegations and knowing we will not be out-lawyered.

The final case I’ll mention is John Doe I, et al, v. ExxonMobil Corporation (D.D.C.). After 22 years of litigation, my colleague Agnieszka Fryszman, and her small but dedicated team succeeded in holding Exxon Mobil accountable for human rights atrocities committed by its security contractors in Indonesia. While the settlement terms are confidential, I will tell you that litigation helped deliver justice to the 11 Jane and John Does who brought the case in 2001. The litigation achievement is tremendous and will be studied in law schools. It was part of a first wave of cases filed under the Alien Tort Statute and went up to the D.C. Circuit Court of Appeals twice, where we won both times. The claims eventually proceeded in U.S. federal court under Indonesian law, and in May 2023, the case settled days before jury trial was set to begin. This case quite literally pioneered the use of foreign tort law against multinational corporations and has provided a roadmap for litigators ever since.

This case exemplifies how relentless our firm is. If a defendant wants to go scorched earth, we will go scorched earth. Our firm may not have the headcount of the country’s largest defense firms, but we put big law resources and a unified partnership behind every case we file. We cannot and will not wave a white flag as a result of being outspent because that would mark the end of our success.

Searcy Denney Scarola Barnhart & Shipley PA, EarthRights International, Conrad & Scherer LLP, Cohen Milstein Sellers & Toll PLLC, International Rights Advocates and several individual attorneys triumphed June 10 after a Florida federal jury ordered Chiquita to pay $38.3 million over its funding of right-wing paramilitaries in Colombia’s banana-producing region. The jury ordered the company to pay 16 of the plaintiffs — all survivors of eight of the nine victims of the Autodefensas Unidas de Colombia whose deaths were at issue in the case — the money as damages for the losses of their loved ones. The plaintiffs are represented by John Scarola, Mariano Garcia and Victoria Mesa-Estrada of Searcy Denney, Rick Herz, Maryum Jordan, Marissa Vahlsing and Marco Simons of EarthRights International, William Scherer of Conrad & Scherer, Agnieszka Fryszman and Leslie Kroeger of Cohen Milstein, Terry Collingsworth of International Rights Advocates and attorneys James Green, William Wichmann, Jonathan Reiter and Gabriela Paola Valentin Diaz.

Red meat processing plant workers have sought preliminary approval for their latest settlement over wage-fixing claims, a $4 million deal that adds American Foods Group LLC to the list of companies to cut deals that also includes JBS, Tyson, Perdue, Seaboard, Triumph and consulting firm Webber Meng Sahl & Co.

Under the deal first teased in late May, the class of workers said in a motion filed Monday that American Foods has also agreed “to significant non-monetary cooperation terms” providing data, documents, witnesses and more as the workers continue to pursue claims against defendants like Smithfield Foods Inc., Nebraska Beef Ltd. and Indiana Packers Corp.

The workers called the proposed deal “fair, reasonable [and] adequate,” arguing it meets all the hallmarks required for approval, including adequate representation by attorneys from Hagens Berman Sobol Shapiro LLP, Cohen Milstein Sellers & Toll PLLC and Handley Farah & Anderson PLLC.

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The proposed class is represented by Shana E. Scarlett, Rio S. Pierce, Abby R. Wolf, Steve W. Berman, Elaine T. Byszewski and Abigail D. Pershing of Hagens Berman Sobol Shapiro LLP, George F. Farah, Rebecca P. Chang, Nicholas J. Jackson, Martha E. Guarnieri, Simon Wiener and William H. Anderson of Handley Farah & Anderson PLLC, Brent W. Johnson, Benjamin D. Brown, Robert A. Braun, Alison S. Deich, Zachary R. Glubiak, Zachary I. Krowitz and Nina Jaffe-Geffner of Cohen Milstein Sellers & Toll PLLC, Brian D. Clark, Stephen J. Teti, Arielle S. Wagner and Eura Chang of Lockridge Grindal Nauen PLLP, and Candice J. Enders and Julia R. McGrath of Berger Montague.

Saman Khodaei said that delivering packages for Amazon as part of its DoorDash-like Flex program was stressful.

The company gave him a set number of packages to deliver in a block of time, he said — noon to 2 p.m., for example. But any number of things could and did delay his deliveries — traffic, of course, since he lived in Los Angeles, but also packages not being ready or even available to be picked up when signed on for his shift or the lack of parking at the Whole Foods stores where he sometimes picked up orders.

The delays were crucial, because Amazon didn’t start paying him until he picked up his packages and wouldn’t pay him extra if it took him longer than the company estimated to make his deliveries.

And every dollar counted, because Amazon treated him as an independent contractor, so he was responsible for paying for his own gas and the wear and tear on his car.

Khodaei said he learned later, after researching the issue, that in addition to causing him stress, Amazon was arguably violating California law.

So he fought back.

About four years ago, along with some 452 other Flex drivers, he filed an arbitration claim against the company. In his claim, he alleged that by misclassifying him as a contractor, Amazon had illegally avoided paying him for the hours he actually worked, including overtime, and reimbursing him for his business-related expenses.

Last October, he won his case, securing $16,000 in damages for uncompensated work and unreimbursed expenses.

“I want every other driver who has [been] mistreated like me in Amazon Flex … [to] lawfully and completely get paid and [for] Amazon [to] stop taking advantage of drivers because they don’t know their rights,” he told The Examiner.

. . .

That Amazon treats Flex workers as contractors and doesn’t pay such expenses is illegal under California, Massachusetts and Illinois law, attorneys for the drivers say. Because making deliveries is part of Amazon’s core business and it exercises considerable control over Flex drivers that are making those deliveries, those states’ laws require the company to treat those drivers as employees, not contractors, they argue.

But in the contract it requires Flex workers to sign, Amazon bars workers from filing suit — either as individuals or as part of a class action — to enforce their rights. It also prohibits them from filing an arbitration claim as a class.

Forcing employees into individual arbitration claims has been a growing theme in employment law since the U.S. Supreme Court opened the door to the practice in 2001. Companies and business advocates have argued that arbitration can be less expensive and faster than going through the courts.

But arbitration also offers numerous advantages to corporations. Unlike lawsuits, arbitration actions are typically kept private, which can prevent other employees who may have had their rights violated from knowing about them, said David Levine, a law professor at UC Law SF.

. . .

So far, the arbitrators in the Amazon cases have largely agreed with the Flex drivers. Of the eight rulings that went in workers’ favor, arbitrators have awarded the winning drivers an average of $9,000 in damages and as much as $22,000 in one case, according to Tindall and Joseph Sellers, a partner at Cohen Milstein Sellers & Toll who is also representing the workers.

In its explanation of terms for California Flex drivers, Amazon cites Prop. 22. That law, which was passed by voters in 2020 and classifies certain delivery and ride-hailing drivers as independent contractors, is currently being reviewed by the California Supreme Court. While it remains in force, Amazon hasn’t used it as a defense in the arbitration cases, Tindall said.

Tindall and Sellers said they’re hopeful that the more than 16,000 remaining cases will move faster now that they’ve gone through those test cases. And as big as that number is, they could add to that total. As of 2021, 2.9 million people in the U.S. had downloaded the Flex app, Bloomberg reported.

“We have people contacting us,” Tindall said.

“Every day,” Sellers said.

Apple could owe thousands in back pay to 12,000 female employees.

Apple has spent years “intentionally, knowingly, and deliberately paying women less than men for substantially similar work,” a proposed class action lawsuit filed in California on Thursday alleged.

A victory for women suing could mean that more than 12,000 current and former female employees in California could collectively claw back potentially millions in lost wages from an apparently ever-widening wage gap allegedly perpetuated by Apple policies.

The lawsuit was filed by two employees who have each been with Apple for more than a decade, Justina Jong and Amina Salgado. They claimed that Apple violated California employment laws between 2020 and 2024 by unfairly discriminating against California-based female employees in Apple’s engineering, marketing, and AppleCare divisions and “systematically” paying women “lower compensation than men with similar education and experience.”

Apple allegedly has displayed an ongoing bias toward male employees, offering them higher starting salaries and promoting them for the “same behaviors” that female employees allegedly were punished for.

. . .

Eve Cervantez, a lawyer for women suing, said in a press release shared with Ars that these women were put in “a no-win situation.”

“Once women are hired into a lower pay range at Apple, subsequent pay raises or any bonuses are tracked accordingly, meaning they don’t correct the gender pay gap,” Cervantez said. “Instead, they perpetuate and widen the gap because raises and bonuses are based on a percentage of the employee’s base salary.”

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Cohen Milstein is partnering with Eve Cervantez at Altshuler Berzon, as well as Outten & Golden on representing the women in this class action lawsuit.

If you are a current or former Apple employee in California and you believe you may have been impacted by this allegedly discriminatory pay practice by Apple, please contact one of our team members below:

Joe Sellers, Esq. and Phoebe Wolfe, Esq. at Cohen Milstein Sellers & Toll PLLC – T: 202-408-4600

Jim Finberg, Esq. and Eve Cervantes, Esq. at Altshuler Berzon – T: 415- 421-7151

Adam T. Klein, Esq. and Chauniqua Young, Esq. at Outten & Golden LLP – T: 212-658-0349

The plaintiffs, who still work for the Bay Area tech giant, are hoping to win money for 12,000 California women.

Two Apple workers launched a major gender discrimination lawsuit against their employer Thursday, accusing the Bay Area tech giant of willfully paying thousands of California women less than men for similar work.

Plaintiffs Justina Jong and Amina Salgado filed the suit as a class-action complaint, proposing a class of 12,000 California women who work in Apple’s engineering, marketing and AppleCare divisions or who worked in one of those divisions over the past four years. They allege that Apple’s pay policies “systematically” leave women with lower wage rates than men and are seeking back pay, interest and damages.

The complaint alleges a few forms of bias at Apple, including in its performance evaluation system and practice of selecting employees for higher pay. But the company’s alleged policy of asking hires for their pay expectations is at the core of the complaint. The plaintiffs’ lawyer, Jim Finberg, told SFGATE that pay expectations are basically a proxy for prior pay, which California has banned employers from asking of hires.

“Part of this case is, you know, to get people back pay, but a big part of it is to change the way Apple operates,” Finberg said. “So that going forward, it’s a more fair, equitable system.”

The lawyer said that asking women about pay expectations “locks” past pay discrimination in and that the requirements of a job should determine pay. Finberg isn’t new to the fight over tech pay; he represented employees suing Oracle and Google for gender-based pay discrimination, securing $25 million and $118 million settlements, respectively.

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The suit alleges that because Apple has records on wage rates and job classifications across the company, the “substantial pay disparities” are willful. As the litigation progresses, those records will likely go before analysts, Finberg said, who will look at trends in the data.

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Cohen Milstein is partnering with Jim Finberg at Altshuler Berzon, as well as Outten & Golden on representing the women in this class action lawsuit.

Apple Inc. was sued by two female employees who claim it “systemically” pays women less than their male counterparts for similar work, and who are seeking to represent thousands of other women facing the same alleged discrimination.

They claim that Apple, of Cupertino, California, determined starting salaries before 2018 by asking employees for their compensation history and that this practice “perpetuated historic pay disparities between men and women.”

Then, when California outlawed the practice, the iPhone maker started asking for salary expectations, entrenching the disparity, the women claim.

“Apple’s policy and practice of collecting such information about pay expectations and using that information to set starting salaries has had a disparate impact on women, and Apple’s failure to pay women and men equal wages for performing substantially similar work is simply not justified under the law,” Joe Sellers, a lawyer at Cohen Milstein Sellers & Toll PLLC representing the employees, said in a statement.