Harris et al v. Express Courier International, Inc.

Filing 130

MEMORANDUM OPINION AND ORDER granting 108 Motion ; denying 112 Motion to Certify Class; see order for specifics. Signed by Honorable Timothy L. Brooks on November 21, 2017. (rg)

IN THE UNITED STATES DISTRICT COURT
WESTERN DISTRICT OF ARKANSAS
FAYETTEVILLE DIVISION
JAMES HARRIS; RICK KETCHAM; and
ADAM MANSKE, Each Individually
and on Behalf of Others Similarly Situated

V.

PLAINTIFFS

Case No. 5: 16-CV-05033

EXPRESS COURIER INTERNATIONAL, INC.
n/k/a LSO FINAL MILE

DEFENDANT

MEMORANDUM OPINION AND ORDER

Before the Court are Defendant Express Courier International, Inc. n/k/a LSO Final
Mile's ("LSO") Motion to Decertify FLSA Collective Action (Doc. 108) and Brief in Support
(Doc. 109); Plaintiffs James Harris's, Rick Ketcham's, and Adam Manske's Response in
Opposition (Docs. 114-115); and LSO's Reply (Doc. 118) and Notice of Supplemental
Authority (Doc. 120). Also before the Court are Plaintiffs' Motion for Rule 23 Class
Certification (Doc. 112) and Brief in Support (Doc. 113); LSO's Response in Opposition
(Doc.116); Plaintiffs' Reply(Doc.117); LSO's Notice of SupplementalAuthority(Doc.121);
and Plaintiffs' Notice of Supplemental Authority (Doc. 122).
After the issues were fully briefed, the Court held a hearing on the two Motions on
August 21, 2017, at which time the parties presented oral argument. The Court took the
matter under advisement. Then, Plaintiffs filed another Notice of Supplemental Authority
on October 9, 2017 (Doc.127), to which LSOfiled a Response (Doc.128). LSO next filed
a separate Notice of Supplemental Authority on October 26, 2017 (Doc. 129). The Court
considered all supplementary authority submitted by the parties, the briefing on the two
Motions, and the oral arguments made during the hearing. Now that the Motions are ripe,

1

the Court is prepared to rule and finds, for the reasons explained in further detail below,
that the Motion to Decertify FLSA Collective Action is GRANTED, and the Motion for Rule
23 Class Certification is DENIED.

I. BACKGROUND
Plaintiffs are former couriers of Defendant LSO, which is a company that facilitates
the delivery of products for the medical, financial, and retail industries, through the work
of couriers who actually perform these deliveries. LSO offers same-day, on-demand, and
scheduled delivery services in ten different states. According to Plaintiffs, LSO has
misclassified its couriers as independent contractors, when they really should be classified
and paid as employees, and LSO has failed to pay their couriers a minimum wage and
overtime compensation for all hours worked over 40 per week.
Plaintiffs argue that they share with their fellow LSO couriers the following
characteristics: (1) they were uniformly classified by LSO as independent contractors and
were not paid minimum-wage and/or overtime compensation; (2) they were required to sign
the same "Owner-Operator Agreement"-which specified that couriers were to be
considered independent contractors-before they were permitted to make deliveries for
the company; (3) they were subject to the same corporate-level policies, procedures, and
training programs; (4) they were subject to a common policy of local control; and (5) they
were subject to common policies regarding pay.
For its part, LSO denies that it has wrongly classified its couriers as independent
contractors. Further, LSO contends that its couriers are not similarly situated to one
another, such that it would be inefficient and inappropriate to group them into a single class

2

for collective action purposes and for class action purposes.
On September 19, 2016, the Court conditionally certified this case as an opt-in, Fair
Labor Standards Act ("FLSA") collective action, and approved Plaintiffs' proposed notice
for mailing to the putative class. See Doc. 34, pp. 10-11. The conditionally-certified
collective action includes:
Each individual who (a) worked for Express Courier International, Inc.
("Express"), as a driver, courier, or owner-operator any time after February
11, 2013, (b) never subcontracted any of his or her work for Express, and (c)
contracted directly with Express under Express's standard "Owner-Operator
Agreement."

Id. at 2.
On April 14, 2017, after the parties engaged in at least six months of discovery
related to class-certification issues, see Phase One Case Management Order, Doc. 35, p.
1, LSO filed a Motion to Decertify the FLSA Collective Action. At approximately the same
time, Plaintiffs filed a Motion to Certify a Rule 23 Class Action under the Arkansas
Minimum Wage Act ("AMWA"). The proposed Rule 23 class includes:
Each individual who (a) worked for Express Courier International, Inc.
("Express"), as a driver, courier, or owner-operator in Arkansas any time after
February 11, 2013, (b) never subcontracted with anyone, or otherwise never
hired anyone, to perform any of his or her work for Express, and (c)
contracted directly with Express under Express's standard "Owner-Operator
Agreement."
(Doc. 112, p. 2).
Below, the Court will begin its discussion by setting forth the legal standards that it
must consider when ruling on the pending Motions. Next, the Court will analyze each
side's arguments on the issue of decertification of the collective action. Last, the Court will
consider the possible certification of a Rule 23 class.

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II. LEGAL STANDARD
A. Motion to Decertify FLSA Collective Action

Certifying a collective action under the FLSA is a two-step process:
The first determination is made at the so-called "notice stage." At the notice
stage, the district court makes a decision-usually based only on the
pleadings and any affidavits which have been submitted-whether notice of
the action should be given to potential class members.
Because the Court has minimal evidence, this determination is made using
a fairly lenient standard, and typically results in "conditional certification" of
a representative class. If the district court "conditionally certifies" the class,
putative class members are given notice and the opportunity to "opt-in." The
action proceeds as a representative action throughout discovery.
The second determination is typically precipitated by a motion for
"decertification" by the defendant usually filed after discovery is largely
complete and the matter is ready for trial. At this stage, the court has much
more information on which to base its decision, and makes a factual
determination on the similarly situated question. If the claimants are similarly
situated, the district court allows the representative action to proceed to trial.
If the claimants are not similarly situated, the district court decertifies the
class, and the opt-in plaintiffs are dismissed without prejudice. The class
representatives-Le. the original plaintiffs-proceed to trial on their individual
claims.
Mooney v. Aramco Servs. Co., 54 F.3d 1207, 1213-14 (5th Cir. 1995), overruled on other
grounds by Desert Palace, Inc. v. Costa, 539 U.S. 90 (2003).

This case is currently at the second step of the two-step process, the so-called
"decertification" phase. Without making any decisions as to the merits of the case, the
Court will be tasked with looking more critically at whether the collective-action mechanism
is an effective way to resolve the claims. See Smith v. Heartland Automotive Servs., Inc.,
404 F. Supp. 2d 1144, 1148 (D. Minn. 2005). In making this assessment, the Court must
examine the purposes of§ 216(b) actions under the FLSA, which are: "(1) reducing the

4

burden on plaintiffs through the pooling of resources, and (2) efficiently resolving common
issues of law and fact that arise from the same illegal conduct." Morgan v. Family Dollar

Stores, Inc., 551 F.3d 1233, 1264 (11th Cir. 2008) (citing Hoffmann-La Roche, Inc. v.
Sperling, 493 U.S. 165, 170 (1989)). If the Court determines that the case is not suitable
for collective-action disposition, the collective action will be decertified, and the merits
decision will proceed on an individual basis, rather than a classwide basis.
In the case at bar, at least 18 named Plaintiffs and opt-in class members were
deposed during the initial period of discovery ordered by the Court. The parties agree that
the key to determining whether LSO is liable to the class members for a violation of law
turns on whether LSO misclassified them as independent contractors.

If LSO did

misclassify them, then the next issue is whether LSO failed to pay them appropriate
minimum and/or overtime wages, to which they are entitled under the FLSA and AMWA.
LSO disputes that any class member was misclassified, and it further disputes that any
class member would be entitled to damages even if they were misclassified.
In order to decide the classification issue, the fact-finder must consider a six-factor
test known as the "economic realities" test. The six factors of the test are:
(1) the degree of control exercised by the alleged employer;
(2) the worker's investment in the business;
(3) the degree to which the worker's opportunity for profit and loss is
determined by the alleged employer;
(4) the skill and initiative in performing the job;
(5) the permanency of the relationship; and
(6) the extent to which the work is an integral part of the alleged employer's
business.

Krupicki v. Eagle One, Inc., 2014 WL 1271053 (E.D. Ark. Apr. 3, 2014) (citing to United
States v. Silk, 331 U.S. 704, 716 (1947)); see also Karlson v. Action Process Serv. &
5

Private Investigations, LLC, 960 F.3d 1089, 1092 (8th Cir. 2017) (citing to these factors
and acknowledging that "many courts have adopted" them as a 11 multi-factor 'economic
realities' test"). On LSO's Motion to Decertify, the Court must consider whether the factual
variations in the class members' work conditions and methods of pay are so great that a
fact-finder would be unable to apply the economic-realities test and make a one-size-fits-all
decision on liability.

8. Motion for Rule 23 Class Certification
Plaintiffs moved to certify a new Rule 23, opt-out class, limited to Arkansas LSO
drivers with wage and hour claims brought pursuant to the AMWA. The parties advise that
there are approximately 260 Arkansas drivers who worked for LSO and would be included
in the proposed class. 1
There are several differences between the FLSA collective action and the proposed
Rule 23 class action. First, as previously explained, the FLSA action requires members
to opt into the class; but the Rule 23 class, once certified, would immediately be composed
of all eligible class members, and class members would be required to affirmatively opt out
in order to be removed from the class. Another difference is that the legal standard for
certifying a collective action is different than the standard for certifying a Rule 23 class
action. Under the FLSA, the Court inquires whether class members are or were subject
to a single, FLSA-violating policy that renders them similarly situated to one another. By
contrast, under Rule 23, the Court must analyze a number of factors, including whether:
(1) the class is so numerous that joinder of all members is impracticable; (2) there are

1

By contrast, the FLSA collective action is composed of an opt-in, nationwide class of
more than 1000 individuals.

6

questions of law or fact common to the class; (3) the claims or defenses of the
representative parties are typical of the claims or defenses of the class; and (4) the
representative parties will fairly and adequately protect the interests of the class. Fed. R.
Civ. P. 23(a)(1 )-(4). The Court must also consider under Rule 23 whether questions of law
or fact common to class members predominate over questions affecting only individual
members, and whether a class action is superior to other available methods for fairly and
efficiently adjudicating the controversy.

Fed. R. Civ. P. 23(b)(3).

Finally, an implicit

requirement for any class certification inquiry under Rule 23 involves the ascertainability
of the class. This means that a proposed class must be sufficiently definite to permit class
members to be identified by objective criteria. See Sandusky Wellness Ctr., LLC v. Medtox
Sci., Inc., 821 F.3d 992, 996-97 (8th Cir. 2016).

Despite the differences between the two proposed classes, the FLSA and AMWA
afford class members essentially the same relief. See Karlson v. Action Process Serv. &
Private Investigations, LLC, 860 F.3d 1089, 1092 n.3 (8th Cir. 2017). This is because

"[t]he definition of employee in the AMWA tracks the FLSA-'any individual employed by
an employer."' Id. (quoting Ark. Code Ann. § 11-4-203(3)). Moreover, "[t]he Arkansas
Administrative Code provides that the Department of Labor 'may rely on . . . federal
precedent established under the Fair Labor Standards Act in interpreting and applying the
provisions of [the AMWA] ... except to the extent a different interpretation is clearly
required."' Id. (quoting Ark. Admin. Code§ 010.14.1-112).
In deciding whether to decertify an FLSA collective action and/or certify a Rule 23
class action, the district court retains discretion to choose the procedural mechanism that

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would most efficiently and effectively resolve the underlying claims. See Smith, 404 F.
Supp. 2d at 1149 ("Determining whether such a collective action is the appropriate means
for prosecuting an action is in the Court's discretion." (citation omitted)); In re Zum Pex

Plumbing Prods. Liab. Litig., 644 F.3d 604, 616 (8th Cir. 2011) (noting that the district court
retains "broad discretion in determining whether to certify a [Rule 23] class, recognizing the
essentially factual basis of the certification inquiry and ... the district court's inherent
power to manage and control pending litigation." (internal quotations and citations
omitted)).

Ill. DISCUSSION
A. Motion to Decertify FLSA Collective Action (Doc. 108)
The Court's obligation at the second stage of the FLSA certification process is to
determine whether the Plaintiffs and putative class members are factually similarly situated,
based on the evidence gathered in discovery. To be similarly situated, Plaintiffs must
adduce evidence to show that they were all victims of a company-wide decision, plan, or
policy that violated the FLSA.
According to the deposition testimony taken in the case, it appears that even though
LSO considers all of its couriers to be independent contractors, it exerts control over these
couriers in different ways, and it pays them differently, as well. Plaintiffs choose to focus
on the similarities the couriers share, while characterizing the disparities in their treatment
and pay as "insignificant differences that have no meaningful impact on the analysis .... "
(Doc. 114, p. 3). Plaintiffs further argue that "it is the right to control, as opposed to the
amount of control that is actually exercised, that is significant," id. at 39 (emphasis in

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original), and they urge the Court to look to the written agreements between the parties,
as well as the official policies of LSO-rather than the testimony of the couriers as to the
way the business was actually run-to decide whether the class should remain certified.

See id. at 43-44.
Plaintiffs' argument about right to control, versus actual control, strains common
sense. In the first place, Plaintiffs cannot help but acknowledge the fact that 18 current or
former LSO couriers testified about their differing experiences working for the company.
Plaintiffs do their best to minimize these differences and draw the Court's attention to what
the couriers have in common; but the couriers' testimony speaks for itself. Furthermore,
the operative term in "economic reality" is, of course, reality, and courts across the country
agree that the actual control a putative employer exerts over its workers is far more
important in the misclassification analysis than the employer's right to control. See Dole

v. Snell, 875 F.2d 802,808 (10th Cir.1989) ("[l]t is notwhatthe [workers] could have done
that counts, but as a matter of economic reality what they actually do that is dispositive. ")
(alterations in original) (quoting Brock v. Mr. W Fireworks, Inc., 814 F.2d 1042, 1047 (5th
Cir.1987)); Donovan v. Sureway Cleaners, 656 F.2d 1368, 1371 (9th Cir. 1981) (agreeing
with the district court that "in evaluating control, the test is not what the agent could do but
what in fact the agent does do") (quotation marks and citation omitted); Spellman v. Am.

Eagle Exp., Inc., 2013 WL 1010444, at *3 (E.D. Pa. Mar. 14, 2013) (''Thus, to the extent
Plaintiffs argue these 'policies' reflect AEX's control over its drivers, . . . an alleged
employer's degree of control over its alleged employees is determined by examining the
employer's actual control, not its right to control.") (emphasis in original).

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In order to determine whether LSO misclassified its couriers, the fact-finder will be
asked to consider the six factors of the economic-realities test and decide whether the
couriers are, in fact, independent contractors or employees. At this stage in the litigation,
however, the Court is not asked to take that ultimate dive into the merits of the case.
Instead, on a motion for decertification, the Court's task is simply to consider whether the
economic-realities inquiry may be performed by the fact-finder on a classwide basis. If
there are too many differences among class members, particularly with respect to how they
were treated and paid by LSO, then the Court will conclude that it will be inefficient, if not
impossible, to attempt to try all the class members' claims at once in a collective action.
Once again, the six factors of the economic-realities test are: (1) the degree of
control exercised by the alleged employer; (2) the worker's investment in the business; (3)
the degree to which the worker's opportunity for profit and loss is determined by the alleged
employer; (4) the skill and initiative in performing the job; (5) the permanency of the
relationship; and (6) the extent to which the work is an integral part of the alleged
employer's business. Krupicki v. Eagle One, Inc., 2014 WL 1271053 (E.D. Ark. Apr. 3,
2014) (citing to United States v. Silk, 331 U.S. 704,716 (1947)). For the reasons explained
below, the Court finds that the first and third factors of the test are not capable of being
decided on a classwide basis, and therefore, the ultimate decision as to whether LSO's
couriers were misclassified cannot be made except on an individual basis. Further, the fact
that LSO paid its couriers in different ways and at different rates makes it impossible to
establish on a classwide basis that LSO violated the FLSA by failing to pay an appropriate
minimum wage and/or overtime compensation.
Beginning with the first factor, which is the degree of control exercised by LSO, the
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couriers' testimony widely varies. It appears that some couriers rarely interacted with
management members and never used the scanners or other monitoring devices that LSO
provided for their vehicles, while other workers testified that they were required to report
to LSO's warehouse each morning and evening, communicate with LSO's management,
and be tracked with a GPS device. One class member testified that he had to check in and
check out daily with a dispatcher, while another testified that he did not check in with
anyone at the warehouse. Still another courier testified that he picked up deliveries directly
from a customer, and the customer's supervisor would check his delivery paperwork. See
Docs. 108-4, pp. 11-12; 108-6, p. 13; 108-7, pp. 37-39; 108-11, pp. 8-9; 108-15, p. 31;
108-16, pp. 7-8; 108-18, pp. 21-22; 108-20, pp. 19-20.
With regard to training, the couriers' testimony shows dissimilar treatment. Some
class members claimed they received minimal training, while others testified they received
several days or weeks of training. See Docs. 108-3, pp. 29-30; 108-7, p. 49; 108-8, pp.
16-17; 108-9, p. 32; 108-14, p. 23; 108-18, pp. 27-28, 29-31. As for the exclusivity of the
work relationship between the couriers and LSO, those workers who were deposed widely
disagreed about whether LSO limited their ability to work for other delivery companies,
such as FedEx, and whether LSO imposed discipline when a courier would refuse to take
a delivery. For example, one courier testified that LSO removed him from the "call list"
when he turned down a run on one occasion, while another courier testified that LSO did
not object to her giving her delivery runs to another driver. Still another courier testified that
he took delivery requests directly from customers and ignored LSO's texts requesting that
he take on extra work, and he was never disciplined for this behavior. See Docs. 108-4,
pp.14-15; 108-6, pp.18-20; 108-7, pp. 7, 32; 108-9, pp. 16-17; 108-11, pp.11-12, 15-17,
11

22-23; 108-14, pp. 6, 11, 15; 108-15, pp. 11, 43; 108-16, p. 11; 108-18, pp. 19-20. The
facts show that the degree to which LSO exercised control over the class members cannot
be established on a classwide basis.
The Court also finds that the third economic-realities test factor-the degree to
which the worker's opportunity for profit and loss is determined by the alleged
employer-cannot be decided on a classwide basis in this case, due to the fact that LSO's
treatment of its couriers was so disparate that a fact-finder would not be able to make
ultimate decisions about how much the class members' collective opportunity for profit and
loss was determined by LSO. For example, one courier testified that LSO paid him one
amount for certain deliveries, but paid a different courier another, higher amount for the
exact same route. See Doc. 108-32, p. 1. Another courier testified that LSO offered to pay
him more if he obtained an SUV; so the courier bought the SUV, and was, in fact, paid
more. See Doc. 108-5, pp. 16-17. Other class members testified that they were paid "by
the piece," while some testified they were either paid a "flat rate" for certain routes or stops
or a· "percentage-rate," plus some amount of reimbursement for fuel costs. See, e.g.,
Docs. 108-3, pp. 19-20; 108-8, pp. 12-13; 108-9, pp. 23-24; 108-14, p. 24; 108-15, p.11;
108-17, p. 10; 108-20, pp. 10-12. It appears these rates of pay also varied for some
couriers depending on the product delivered or the customer being serviced. See Docs.
108-7, pp. 33-34; 108-10, pp. 14-15; 108-18, pp. 17-18, 25. Indeed, some class members
testified they were paid a certain rate for all in-town deliveries, but a different rate for outof-town deliveries. See Doc. 108-16, p. 10. And while most couriers testified that LSO
completely controlled the manner in which they were paid, one courier claimed that he was

12

able to negotiate a pay raise from LSO on his own behalf. See Doc. 108-4, pp. 17-18.
From all of this evidence, it is quite clear to the Court that LSO's treatment of its couriers
varied so greatly, from location to location, and even from courierto courier, such that there
would be no way for a fact-finder to decide on a classwide basis the degree to which LSO
affected the couriers' collective opportunity for profit and loss.
Along the same lines, even if a fact-finder could determine the misclassification
issue on a classwide basis, Plaintiffs have not presented the Court with a feasible method
for establishing which, if any, class member was paid below the minimum wage or was
denied overtime pay in violation of the FLSA. Instead, multiple individual inquiries would
be needed in order to determine how many hours each courier worked when driving for
LSO, and how much each courier was paid for that work.
Because LSO couriers were paid in so many different ways (e.g.,"by the piece," at
a "flat rate" for certain routes, according to a "percentage-rate" plus fuel reimbursement,
or on a "per-mile" system for certain deliveries), calculating the number of hours the
couriers worked per week would necessitate individualized inquiries.

Discovery has

revealed that for at least some couriers, if not most of them, the vehicles they used to
deliver packages were also the vehicles they used for their personal needs, and in some
cases, for other driving-related jobs (e.g., driving for FedEx, Uber, or a taxi company).
Trying to reconstruct the mileage logs and convert the work-only mileage into an hourly
rate of pay-given the differing ways that the couriers were paid-would require individual
proof and would likely be a highly speculative endeavor. The Court is mindful that in FLSA
cases, the worker has the burden of proving "that he has in fact performed work for which
he was not properly compensated .... " Anderson v. Mt. Clemens Pottery Co., 328 U.S.

13

680,687 (1946), superseded by statute on other grounds, 29 U.S.C. § 254(a). The Court
therefore finds that it will be impossible to meet this burden of proof at trial on a classwide
basis.
Accordingly, the Court in its discretion finds that maintaining the collective action will
not provide an efficient and cost-effective mechanism to resolve the liability questions in
this case, as compared to proceeding with individual actions. In particular, the Court finds
that the liability issues cannot be resolved on a classwide basis without significant
individual inquiry.

Therefore, LSO's Motion to Decertify FLSA Collective Action is

GRANTED. The opt-in plaintiffs will be dismissed by operation of this Order, butthe matter

will be stayed and the opt-in class members' claims tolled for a period of 60 days to allow
them to file their individual claims in the appropriate courts. During this 60-day stay,
Plaintiffs' counsel will be required to send a copy of this Order and an instructional letter
to all opt-in class members, advising them of their legal rights going forward.

B. Motion for Rule 23 Class Certification (Doc. 112)
Plaintiffs propose certifying a Rule 23 class of approximately 260 couriers who drove
for LSO in Arkansas. The purported class's claims for relief would arise under the AMWA,
rather than the FLSA. Thus, the threshold question that Plaintiffs bring in their Motion for
Class Certification is: Should the economic-realities test be applied in the AMWA context?
Plaintiffs believe that when a fact-finder is called upon to determine whether the couriers
were misclassified as independent contractors, it will use the definition of "independent
contractor'' from the AMWA and judge whether the class members meet that definition,
rather than employ the economic-realities test.

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The AMWA defines an independent contractor as "any individual who contracts to
perform certain work away from the premises of his or her employer, uses his or her own
methods to accomplish the work, and is subject to the control of the employer only as to
the

result

of

his

or

her

work."

Ark.

Code

Ann.

§

11-4-203(6).

LSO

contends-correctly-that no case law supports Plaintiffs' position that it would be illegal
or improper to analyze the misclassification issue under the AMWA using the economicrealities test. The AMWA's minimum-wage and overtime rules predicate recovery on a
worker being classified as an "employee"-and the AMWA's definition of "employee" is
exactly the same as the FLSA's. Compare Ark. Code Ann. § 11-4-203(3) to 29 U.S.C.
§ 203(e)(1 ). Furthermore, other district courts in the Western District of Arkansas have
applied the economic-realities test in the AMWA context. See, e.g., Carterv. Primary Home

Care of Hot Springs, Inc., 2015 WL 11120563, at *3 (W.D. Ark. May 14, 2015). There
does not appear to be any good reason to limit the misclassification inquiry to the AMWA's
definition of "independent contractor," when the economic-realities test affords a more
nuanced and thorough approach to the issue and does not contravene the AMWA in any
respect.
Next, the Court considers whether the purported class will be sufficiently numerous
and readily ascertainable enough to weigh in favor of class certification; whether questions
of law or fact are common to the members of the purported class and whether the claims
of the named Plaintiffs are typical of those of the rest of the class-in light of the fact that
the economic-realities test will be employed by a fact-finder to decide the key issue of
misclassification; whether questions of law or fact common to class members predominate
over questions affecting only individual members; and whether a class action is superior
15

to other available methods for fairly and efficiently adjudicating the controversy. 2
1. Numerosity and Ascertainability
Plaintiffs represent that there are approximately 260 individuals who would be
included in the Rule 23 opt-out class. There does not appear to be any meaningful
opposition to the notion that the class is sufficiently numerous to warrant certification and
that these 260 individuals' identities are readily ascertainable. These factors therefore
weigh in favor of certification.
2. Commonality and Typicality
Turning to the factors of commonality and typicality, Plaintiffs in their briefing point
to the similarities that LSO couriers share, while LSO points to their differences-primarily
those that would show the degree of control exerted by LSO, as well as the couriers'
differing opportunities for profit and loss. Interestingly, Plaintiffs are quite up-front with the
Court about the fact that they only want a "liability class" to be certified, and not a
"damages class," presumably because they recognize that individualized inquiries will be
inevitable when attempting to calculate how many hours each courier worked and how
much they earned per hour, considering the different ways in which they were paid by LSO.
Plaintiffs urge the Court to postpone its discussion of how the class members' hourly
wages will be calculated, and certify a liability-only class that focuses on the question of
whether the couriers are employees or independent contractors under the AMWA. As
previously explained, the crucial first and third factors of the economic-realities test are not
susceptible to classwide proof. See supra, Section Ill.A. Further, the fact that LSO
2

The Court will assume, for purposes of this analysis, that the named Plaintiffs would
adequately represent the interests of the class, if one were certified.

16

couriers are not subject to a common pay policy destroys the possibility of proceeding with
a class action. LSO would not be automatically liable for wage and hour violations if it
misclassified its couriers. Instead, to prove liability, Plaintiffs would also have to prove that
the couriers were not paid an appropriate weekly minimum wage and/or that they were not
paid overtime when they worked in excess of 40 hours per week. Although Plaintiffs are
correct that a precise method for calculating damages is not generally expected at the time
of certification, their failure to supply the Court with any viable method for calculating the
number of hours worked and amount of wages paid-on a classwide basis-means that
liability cannot be ultimately determined except as to each individual courier.

In other

words, the question of how much the couriers are owed by LSO is a question that can be
put aside until later; but the question of whether the couriers are owed anything due to a
failure to comply with the AMWA is a liability question that cannot be set aside.
Because Plaintiffs and the purported class lack commonality with regard to how they
will prove they are employees, rather than independent contractors, this factor weighs
against certification. Further, because Plaintiffs' claims differ from one another's-and
from those of the other purported class members-with respect to the degree of control
LSO exerted over their work and their ability to profit, and with respect to the ways in which
they were paid for their work, Plaintiffs' claims are not sufficiently typical of those of the rest
of the class to weigh in favor of certification.

C. Predominance and Superiority
Plaintiffs argue that questions of law and fact regarding the exempt/non-exempt
status of the couriers predominate over individual questions. Although the exempt/nonexempt question is common to all the class members and is, in fact, the threshold question

17

that must be answered with respect to liability, a classwide determination on this very issue
will be extremely onerous, if not impossible, for the reasons already discussed in this
Order. Accordingly, the Court finds that the class action mechanism is not superior to
holding individual trials on the issue of liability. The lack of uniformity in how the couriers
were paid, in and of itself, is fatal to achieving effective and efficient classwide
consideration of LSO's alleged liability. Plaintiffs' Motion for Rule 23 Class Certification is
DENIED.
IV. CONCLUSION

In consideration of the Court's discussion above, IT IS ORDERED that Defendant
Express Courier International, Inc. n/k/a LSO Final Mile's Motion to Decertify FLSA
Collective Action (Doc. 108) is GRANTED, and the collective action is hereby
DECERTIFIED.

IT IS FURTHER ORDERED that Plaintiffs James Harris's, Rick Ketcham's, and
Adam Manske's Motion for Rule 23 Class Certification (Doc. 112) is DENIED.
IT IS FURTHER ORDERED that Plaintiffs' counsel is DIRECTED to provide a copy

of this Order and an instructional letter to all opt-in collective action members, explaining
their legal options in light of the Court's decision to decertify.
IT IS FURTHER ORDERED that the claims of the opt-in collective action members
are TOLLED FOR A PERIOD OF 60 DAYS FROM TODAY'S DATE in order to allow them
to receive notice of this Court's Order regarding decertification and, if desired, to file their
individual claims in the appropriate court or courts.
IT IS FURTHER ORDERED that Plaintiffs James Harris's, Rick Ketcham's, and

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Adam Manske's individual claims will proceed , and a case management order will issue
forthwith , granting a limited time-period for the parties to conduct merits discovery, setting
a deadline to file dispositive motions, a~ifixing a date for trial.
IT IS SO ORDERED on this 11...:- ay of November, 2017
d

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