Sanchez et al v. Simply Right, Inc. et al

Filing 186

ORDER adopting in part and rejecting in part 174 Report and Recommendations; granting in part, denying in part, and denying as moot in part 121 plaintiffs' motion for conditional certification; denying defendants' 149 motion to strike; denying 177 plaintiffs' motion for status conference. So Ordered by Judge Raymond P. Moore on 05/22/2017. (Attachments: # 1 Exhibit)(rmlc2)

Case 1:14-cv-02612-JLK Document 152 Filed 03/27/17 USDC Colorado Page 1 of 9
Appellate Case: 17-1028

Document: 01019785739

Date Filed: 03/27/2017

UNITED STATES COURT OF APPEALS
FOR THE TENTH CIRCUIT
_________________________________
In re: CHIPOTLE MEXICAN
GRILL, INC.,
Petitioner.

Page: 1
FILED
United States Court of Appeals
Tenth Circuit

March 27, 2017
Elisabeth A. Shumaker
Clerk of Court

No. 17-1028
(D.C. No. 1:14-CV-02612-JLK)
(D. Colo.)
_________________________________

ORDER DENYING PETITION FOR MANDAMUS RELIEF
_________________________________
Before LUCERO, O’BRIEN, and MATHESON, Circuit Judges.
_________________________________
Chipotle Mexican Grill, Inc., petitions this court for a writ of mandamus vacating
the district court’s joinder of 10,000 opt-in plaintiffs to the underlying collective action
brought pursuant to the Fair Labor Standards Act (FLSA). Chipotle requests we remand
with instructions to dismiss all of the opt-in plaintiffs or, alternatively, remand with
instructions to permit discovery (to determine which opt-in plaintiffs are similarly
situated) and to give Chipotle the opportunity to decertify the collective. We deny the
petition.
I. The Writ of Mandamus Standard
“Only exceptional circumstances, amounting to a judicial usurpation of power,
will justify the invocation of [the] extraordinary remedy [of mandamus].” In re Cooper
Tire & Rubber Co., 568 F.3d 1180, 1186 (10th Cir. 2009) (internal quotation marks
omitted). “Mandamus is not the same as, nor is it a substitute for, a direct appeal.”
In re Motor Fuel Temperature Sales Practices Litig., 641 F.3d 470, 487 (10th Cir. 2011).

Case 1:14-cv-02612-JLK Document 152 Filed 03/27/17 USDC Colorado Page 2 of 9
Appellate Case: 17-1028

Document: 01019785739

Date Filed: 03/27/2017

Page: 2

Therefore, “[t]here must be more than what we would typically consider to be an abuse of
discretion in order for the writ to issue.” Cooper Tire, 568 F.3d at 1186. The petitioner
must show it has “no other adequate means to attain the relief [it] desires” and its “right
to the writ is clear and indisputable.” Id. at 1187 (internal quotation marks omitted).
Further, this court, “in the exercise of its discretion, must be satisfied that the writ is
appropriate under the circumstances.” Id. (internal quotation marks omitted).
We have identified five nonconclusive factors for consideration in determining
whether the writ may issue:
(1) whether the party has alternative means to secure relief; (2) whether the
party will be damaged in a way not correctable on appeal; (3) whether the
district court’s order constitutes an abuse of discretion; (4) whether the
order represents an often repeated error and manifests a persistent disregard
of federal rules; and (5) whether the order raises new and important
problems or issues of law of the first impression.
Id. (internal quotation marks omitted).
II. Our FLSA Precedent
The FLSA ensures certain employers pay their employees the minimum wage and
overtime compensation if earned. See 29 U.S.C. §§ 206–07. To enforce these laws, it
creates a private right of action for “one or more employees” to bring an action against
their employer to recover unpaid wages or overtime compensation on “behalf of himself
or themselves and other employees similarly situated.” Id. § 216(b). Though “similarly
situated” is not defined by the FLSA, see Thiessen v. Gen. Elec. Capital Corp., 267 F.3d
1095, 1102 (10th Cir. 2001), district courts must determine who is similarly situated in a
“manner that is orderly, sensible, and not otherwise contrary to statutory commands or
2

Case 1:14-cv-02612-JLK Document 152 Filed 03/27/17 USDC Colorado Page 3 of 9
Appellate Case: 17-1028

Document: 01019785739

Date Filed: 03/27/2017

Page: 3

the provisions of the Federal Rules of Civil Procedure.” Hoffmann-La Roche Inc. v.
Sperling, 493 U.S. 165, 170 (1989).
In Thiessen, we discussed three different approaches district courts use to
determine who is similarly situated: the ad hoc approach, the Rule 23 approach, and the
spurious approach. 267 F.3d at 1102–03. Under the two-step certification or “ad hoc”
approach, a court “makes an initial notice stage determination of whether plaintiffs are
similarly situated,” requiring “nothing more than substantial allegations that the putative
class members were together the victims of a single decision, policy, or plan.” Id. at
1102 (internal quotation marks omitted). Then, after discovery, the court makes a
second, stricter similarly-situated determination considering “(1) disparate factual and
employment settings of the individual plaintiffs; (2) the various defenses available to
defendant which appear to be individual to each plaintiff; (3) fairness and procedural
considerations; and (4) whether plaintiffs made the filings required by the [FLSA] before
instituting suit.” Id. at 1103 (internal quotation marks omitted).
Under the Rule 23 approach, “courts have incorporated into § 216(b) the
requirements of current Federal Rule of Civil Procedure 23,” using “numerosity,
commonality, typicality, and adequacy of representation and 23(b)(3)’s requirement that
common questions of fact predominate . . . to determine whether plaintiffs are similarly
situated.” Id. (internal quotation marks omitted). Finally, under the spurious approach,
courts incorporate into § 216(b) the pre-1966 requirements of Rule 23 based on the
Advisory Committee notes, which are: (1) “the character of the right sought to be
enforced . . . must be several,” (2) “there must be a common question of law or fact
3

Case 1:14-cv-02612-JLK Document 152 Filed 03/27/17 USDC Colorado Page 4 of 9
Appellate Case: 17-1028

Document: 01019785739

Date Filed: 03/27/2017

Page: 4

affecting the several rights,” and (3) “a common relief must be sought.” Id. (internal
quotation marks omitted). We concluded the district court in Thiessen did not abuse its
discretion in adopting the ad hoc approach in a case under the Age Discrimination in
Employment Act. Id. at 1105.
III. The District Court’s Approach
In this case, the district court first determined that the “‘certification’ rubric
borrowed from Rule 23 has no place in wage claim litigation under the FLSA.” Turner v.
Chipotle Mexican Grill, Inc., 123 F. Supp. 3d 1300, 1305 (D. Colo. 2015). Instead, with
heavy reliance on scholarship, the court concluded that “[j]oinder under § 216(b) is . . .
even more lenient than joinder or intervention under” Rules 19, 20, and 24. Id. at 1306.
More specifically, it noted that, for the first 50 years after enactment of the FLSA,
§ 216(b) actions were akin to spurious class actions under the old Rule 23(a)(3). Id. The
certification mechanism later incorporated by the ad hoc approach was, according to the
court, borne of the 1966 amendments to Rule 23 to protect “the right to due process for
absent parties.” Id. at 1307. The court reasoned, however, that because all parties to a
FLSA action have to affirmatively opt into the suit, there is no need to involve such
certification requirements for the sake of absent parties. Id.
Thus, the court found other courts have improperly conflated Rule 23’s
requirements “with the liberalized joinder device of collective actions” and concluded
that the proper approach “is to presumptively allow workers bringing the same statutory
claim against the same employer to join as a collective, with the understanding that
individuals may be challenged and severed from the collective if the basis for their
4

Case 1:14-cv-02612-JLK Document 152 Filed 03/27/17 USDC Colorado Page 5 of 9
Appellate Case: 17-1028

Document: 01019785739

Date Filed: 03/27/2017

Page: 5

joinder proves erroneous” under Rule 21. Id. at 1307, 1309. In this vein, the district
court hewed closely to the spurious approach, as misjoinder under Rule 21 “occurs when
there is no common question of law or fact.” See DirecTV, Inc. v. Leto, 467 F.3d 842,
844 (3d Cir. 2006); Thiessen, 267 F.3d at 1103 (noting the spurious approach requires a
common question of law or fact and a request for common relief).
IV. Discussion
Chipotle first alleges that the district court ignored Thiessen in reaching its
decision. Specifically, Chipotle argues that Thiessen does not accord the district court
discretion to choose between various approaches to conducting FLSA collective actions
and, even if it did, the district court would be limited to creating certification mechanisms
consistent with Thiessen. Nothing in Thiessen issues such a mandate. Though we opined
that the two-step process is arguably the best of the three approaches we examined, we
also noted that “there is little difference in the various approaches. All approaches allow
for consideration of the same or similar factors, and generally provide a district court
with discretion to deny certification for trial management reasons.” 267 F.3d at 1105.
Chipotle surmises our note about “the same or similar factors” acts as a sword against the
district court’s determination, but this reading ignores the context in which we decided
Thiessen. Our ultimate holding on this issue was limited to finding “no error” for
“adopting the ad hoc approach”; we did not adopt this approach as mandatory within our
circuit. Id. Indeed, we noted “there [was] little circuit law on the subject,”
acknowledging the district courts’ flexibility to determine whether plaintiffs are similarly
situated. Id. at 1102. Thus, nothing in Thiessen proscribes the district court from
5

Case 1:14-cv-02612-JLK Document 152 Filed 03/27/17 USDC Colorado Page 6 of 9
Appellate Case: 17-1028

Document: 01019785739

Date Filed: 03/27/2017

Page: 6

following the spurious approach consistent with § 216(b), leaving Chipotle without a
“clear and indisputable” right on which to base its request for mandamus relief. Cooper
Tire, 568 F.3d at 1187 (internal quotation marks omitted).
Chipotle next contends that the district court’s orders violate its due process rights
by “certifying a collective . . . without any reasoned threshold determination that a
collective action is appropriate.” Pet. at 18. Chipotle maintains the district court’s
spurious approach (requiring only opt-in plaintiffs’ consent at this stage and placing the
burden on Chipotle to “winnow” the collective thereafter) is contrary to § 216(b)’s
“threshold requirement” that plaintiffs be similarly situated, thus depriving it of the
opportunity to assert defenses. Pet. at 20–22 (internal quotation marks omitted). But
Chipotle’s repeated reference to a threshold determination is misplaced, as there is no
statutory mandate for any initial determination; the only requirement that § 216(b)
imposes is that plaintiffs be similarly situated. Chipotle identifies no authority from the
Supreme Court or this court stating otherwise or prohibiting the district court’s
construction of the collective formation process here. It points mostly to district courts
that have approached the determination differently. Chipotle thus conflates § 216(b)’s
requirement with some sort of burden on the plaintiffs to prove similarity prior to
formation of the collective. For our purposes, the district court’s order is consistent with
§ 216(b). 1 We note that, despite Chipotle’s protestations about the proper burden, the

1

Just as we did in Thiessen, we make no definitive determination on the merits of
using the spurious approach as opposed to either of the others. We merely state that,
under our existing precedent, the district court’s order is not such a gross abuse of
(continued)
6

Case 1:14-cv-02612-JLK Document 152 Filed 03/27/17 USDC Colorado Page 7 of 9
Appellate Case: 17-1028

Document: 01019785739

Date Filed: 03/27/2017

Page: 7

district court has yet to formally finalize the collective. It may be cumbersome for
Chipotle to winnow down the collective. But Chipotle has not established that it has a
“clear and indisputable” right to escape this task. Cooper Tire, 568 F.3d at 1187 (internal
quotation marks omitted).
Finally, Chipotle argues that the district court’s orders conflict with the Supreme
Court’s mandate that “any process used to establish a § 216(b) collective be ‘not
otherwise contrary to’ the [Rules].” Pet. at 24 (quoting Hoffmann-La Roche, 493 U.S. at
170). Chipotle asserts that the district court’s approach exceeds Rule 20’s requirement
that the suit arise from the same “transaction, occurrence, or series of transactions or
occurrences.” Pet. at 24 (internal quotation marks omitted). But we have never said so,
and at least one circuit has expressly approved of the district court’s approach here.
See Grayson v. K Mart Corp., 79 F.3d 1086, 1096 (11th Cir. 1996) (“We hold that
section 216(b)’s ‘similarly situated’ requirement is less stringent than that for joinder
under Rule 20(a).”). And in any event, to the extent that Hoffmann-La Roche confines
the scope of § 216(b) to the scope of Rule 20, the district court’s joinder of the opt-in
plaintiffs in this suit is not such a gross abuse of discretion to warrant mandamus in light
of the flexibility inherent to Rule 20. See Mosley v. Gen. Motors Corp., 497 F.2d 1330,
1333 (8th Cir. 1974) (stating “all logically related events entitling a person to institute a
legal action against another generally are regarded as comprising a transaction or

discretion as to warrant mandamus relief. We do not decide the propriety of the district
court’s actions in any other respect.
7

Case 1:14-cv-02612-JLK Document 152 Filed 03/27/17 USDC Colorado Page 8 of 9
Appellate Case: 17-1028

Document: 01019785739

Date Filed: 03/27/2017

Page: 8

occurrence” (internal quotation marks omitted)); id. (“[A] case by case approach is
generally pursued.”); id. (“Absolute identity of all events is unnecessary.”).
In Mosley, the Eighth Circuit held on interlocutory appeal that the district court
abused its discretion severing joined actions alleging a racially discriminatory policy. Id.
at 1334. Meanwhile, the Fifth Circuit affirmed a district court’s “wide discretion to
conclude that trying [FLSA] claims together would be too challenging logistically, given
the divergent working conditions at each store.” Acevedo v. Allsup’s Convenience Stores,
Inc., 600 F.3d 516, 522 (5th Cir. 2010). Given that the Plaintiffs have plausibly alleged
an automated program clocking them out at a certain hour for each opt-in plaintiff, there
is no weight of authority that clearly and indisputably removes such a policy from the
realm of the district court’s “wide discretion.” Id. Mandamus is thus inappropriate.
In the end, the only potentially problematic concern Chipotle raises is the specter
of thousands of opt-in plaintiffs found by the district court to be misjoined and
subsequently severed into what could be an absurd number of lawsuits. Chipotle,
however, has no certainty that the district court would proceed in this manner. Under
Rule 21, the district court retains the flexibility to sever the actions or enter a final
judgment of dismissal “in either one of the resulting two actions notwithstanding the
continued existence of unresolved claims in the other.” Reinholdson v. Minnesota,
346 F.3d 847, 850 (8th Cir. 2003) (internal quotation marks omitted). Though the district
court here might be limited to severance (rather than dismissal) if the statute of
limitations has expired, see Strandlund v. Hawley, 532 F.3d 741, 746 (8th Cir. 2008), it is
still speculative to assume that each misjoined opt-in plaintiff would merit a singular
8

Case 1:14-cv-02612-JLK Document 152 Filed 03/27/17 USDC Colorado Page 9 of 9
Appellate Case: 17-1028

Document: 01019785739

Date Filed: 03/27/2017

Page: 9

lawsuit as opposed to a grouping scheme the district court has discretion to determine. It
would therefore be premature to consider mandamus relief in connection with the district
court’s handling of any misjoined plaintiffs.
The district court’s approach to these threshold issues may be debatable, but
Chipotle has not shown its “right to the writ is clear and indisputable.” Cooper Tire,
568 F.3d at 1187 (internal quotation marks omitted). Accordingly, we deny the petition.
Entered for the Court

ELISABETH A. SHUMAKER, Clerk

9