Baricuatro et al v. Industrial Personnel and Management Services, Inc. et al
ORDER and REASONS - Before the Court are Plaintiffs' Motion for Class Certification Pursuant to Fed. R. Civ. P. 23 401 and Plaintiffs' Motion for Separate Trials of Claims and Issues Pursuant to FRCP 42(b) 400 . IT IS ORDERED that; 1) Pl aintiffs' Motion for Class Certification Pursuant to Fed. R. Civ. P. 23 (Rec. Doc. 401) is hereby DENIED, and plaintiffs' Motion for Separate Trials of Claims and Issues Pursuant to FRCP 42(b) (Rec. Doc. 400) is hereby DENIED WITHOUT PREJUD ICE; 2) Counsel for the parties to the FLSA collective action shall confer and submit within thirty (30) days a joint proposed trial plan for the FLSA claims, as stated within document. Signed by Judge Kurt D. Engelhardt on 11/18/2013. (cbs) (Main Document 551 replaced on 11/18/2013) (cbs).
UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF LOUISIANA
ISIDRO BARICUATRO, ET AL
INDUSTRIAL PERSONNEL AND
MANAGEMENT SERVICES, INC., ET AL
SECTION “N” (2)
ORDER AND REASONS
Before the Court are Plaintiffs’ Motion for Class Certification Pursuant to Fed. R. Civ.
P. 23 (Rec. Doc. 401) and Plaintiffs’ Motion for Separate Trials of Claims and Issues Pursuant to
FRCP 42(b) (Rec. Doc. 400). Defendants’ opposition memoranda are filed at Rec. Docs. 468,
469, 471, 473, 480, 481, and 482. Plaintiffs’ reply memoranda are at Rec. Docs. 516 and 517.
Defendants’ sur-reply memorandum is at Rec. Doc. 522.
The plaintiffs are Filipino workers (including welders and pipe fitters) who allege that
they were fraudulently recruited in the Philippines, given E-2 or B-1/OCS visas, and then
brought to Louisiana, where they were exploited in the oil and gas industry and housed in
deplorable conditions. They have filed suit against three Louisiana companies (Grand Isle
Shipyard, Inc. (“GIS”); Thunder Enterprises, Inc.; and D&R Resources, LLC) and four
individuals connected to one or more of these companies: Mark Pregeant; Danilo N. Dayao;
Nilfil Peralta; and Randolf Malgapo.
In addition, they have sued four Philippines companies
alleged to have recruited and/or obtained visas for certain of the plaintiffs: DNR Offshore and
Crewing Services, Inc. (“DNR”); Pacific Ocean Manning, Inc. (“POMI”); V Manpower
Philippines, Inc., f/k/a V People Manpower Philippines, Inc. (“V People”); and Industrial
Personnel and Management Services, Inc. (“IPAMS”).1 See Rec. Docs. 1, 24, 172, 235, 311.
The plaintiffs have alleged that the defendants: (1) subjected them to forced labor in
violation of the Trafficking Victims Protection Act of 2003 (18 U.S.C. §§ 1589-90); (2) violated
the Racketeer Influenced and Corrupt Organization Act (“RICO”) (18 U.S.C. §§ 1961- 68); (3)
violated the plaintiffs’ civil rights (42 U.S.C. § 1981); (4) violated the Fair Labor Standards Act
(“FLSA”) (19 U.S.C. §§ 203(m), 206 & 207); (5) violated the Klu Klux Klan Act of 1871 (42
U.S.C. § 1985) and the Thirteenth Amendment; (6) committed the torts of fraud, negligent
misrepresentation, false imprisonment, and intentional and negligent infliction of emotional
distress under Louisiana law; and (7) breached contracts and/or covenants of good faith and fair
dealing. See Rec. Docs. 1, 24, 172, 235, 311. The plaintiffs also assert these claims on behalf
of others similarly situated, as a putative class action under FRCP 23 and a putative collective
action under the FLSA. See Rec. Docs. 1, 24, 172, 235.
The Court has conditionally certified the FLSA collective action. Rec. Docs. 218, 239.
The Court has also granted summary judgment dismissing the plaintiffs’ false imprisonment
Plaintiffs have recently dismissed their claims against defendants IPAMS and Nilfil
Peralta. See Rec. Docs. 543, 544, 545 and 546.
claims. Rec. Doc. 465. A motion for summary judgment on plaintiffs’ claims pursuant to the
Trafficking Victims Protection Act of 2003 (“TVPA”), 18 U.S.C. § 1589 et seq., is pending.
Rec. Doc. 444.
LAW AND ANALYSIS:
Pursuant to Federal Rule of Civil Procedure 23(b)(3), plaintiffs seek certification of two
classes based on claims of breach of contract and the implied covenant of good faith and fair
dealing: (1) all individuals who signed employment contracts with D&R Resources or V
Offshore, Ltd. to work for Grand Isle Shipyards under E-2 and/or B-1 OCS visas since October
1, 2005; and (2) all individuals who signed employment contracts with Grand Isle Shipyards,
Inc. to work for Grand Isle Shipyards, Inc. under H2-B visas since October 1, 2005. See Rec.
Doc. 401 at 1-2.
In addition, pursuant to Rule 23(b)(2), plaintiffs seek certification of a third class, seeking
declaratory and injunctive relief only for alleged violations of RICO and the TVPA. This
proposed class would comprise “all individuals who are or will be employed by D&R Resources,
LLC and recruited by DNR Offshore Crewing Services to work for Grand Isle Shipyard, Inc.
under a visa from the Philippines.” Rec. Doc. 401 at 2.
“The class action is an exception to the usual rule that litigation is conducted by and on
behalf of the individual named parties only.” Wal-Mart Stores, Inc. v. Dukes, 131 S.Ct. 2541,
2550 (2011) (internal quotation marks omitted). “In order to justify a departure from that rule, a
class representative must be part of the class and possess the same interest and suffer the same
injury as the class members.” Id. (internal quotation marks omitted). “Rule 23(a) ensures that
the named plaintiffs are appropriate representatives of the class whose claims they wish to
litigate” and its “four requirements — numerosity, commonality, typicality, and adequate
representation — effectively limit the class claims to those fairly encompassed by the named
plaintiff’s claims.” Id. (internal quotation marks omitted).
Because of the “important due process concerns of both plaintiffs and defendants
inherent in the certification decision,” the Supreme Court and Fifth Circuit require district courts
to conduct a “rigorous analysis” of the Rule 23 requirements. Madison v. Chalmette Refining,
L.L.C., 637 F.3d 551, 554 (5th Cir. 2011) (internal quotation marks omitted) (citing Gen. Tel. Co.
v. Falcon, 457 U.S. 147, 161 (1982)); M.D. ex rel. Stukenberg v. Perry, 675 F.3d 832, 837 (5th
Cir. 2012) (“It is well-established that “[a] district court must conduct a rigorous analysis of the
[R]ule 23 prerequisites before certifying a class.”) (quoting Castano v. Am. Tobacco Co., 84 F.3d
734, 740 (5th Cir.1996)). This rigorous analysis requires the Court to look beyond the pleadings,
for the “court must understand the claims, defenses, relevant facts, and applicable substantive
law in order to make a meaningful determination of the certification issues.” Madison, 637 F.3d
at 555 (quoting Unger v. Amedisys Inc., 401 F.3d 316, 321 (5th Cir.2005)). Indeed, it “requires
examination of both ‘the parties’ claims and evidence,’ “ for the “plain text of Rule 23 requires
the court to ‘find,’ not merely assume, the facts favoring class certification.” Madison, 637 F.3d
at 555 (quoting Unger, 401 F.3d at 321) (internal quotation marks omitted).
The Fifth Circuit has stressed that throughout the certification inquiry, it is the party
seeking certification who bears the burden of establishing that each Rule 23 requirement is met.
Madison, 637 F.3d at 554-55; Berger v. Compaq Computer Corp., 257 F.3d 475, 481 (5th Cir.
2001) (“the party seeking certification bears the burden of establishing that all requirements of
Rule 23(a) have been satisfied”) (emphasis in original). Even in the absence of evidence to the
contrary, the Court may not presume that any of the Rule’s requirements are met but must hold
the party seeking certification to its proof, for the Court owes a duty to ensure that the due
process rights of absent putative class members are protected. Berger, 257 F.3d at 481-82.
Under Rule 23, a court may allow one or more members of a class to sue as
representative parties on behalf of all members “only if: (1) the class is so numerous that joinder
of all members is impracticable; (2) there are 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) (emphasis added). In addition, plaintiffs must satisfy at least one
of the requirements of Rule 23(b). In this case, the plaintiffs rely on Rule 23(b)(3) to certify
their two proposed breach-of-contract classes and on Rule 23(b)(2) to certify their proposed
Proposed Rule 23(b)(3) Classes Seeking Damages for Breach of Contract:
Pursuant to Federal Rule of Civil Procedure 23(b)(3), plaintiffs seek certification of two
classes based on claims of breach of contract and implied covenant of good faith and fair
All individuals who signed employment contracts with D&R Resources or
V Offshore, Ltd. to work for Grand Isle Shipyards under E-2 and/or B-1
OCS visas since October 1, 2005; and
All individuals who signed employment contracts with Grand Isle
Shipyards, Inc. to work for Grand Isle Shipyards, Inc. under H2-B visas
since October 1, 2005.
See Rec. Doc. 401 at 1-2. To certify a class under Rule 23(b)(3), in addition to the four
requirements of Rule 23(a) (i.e., numerosity, commonality, typicality, and adequacy), the
plaintiffs must also demonstrate: (1) that the questions of law or fact common to the class
predominate over any questions affecting only individual members (referred to as the
“predominance” requirement), and (2) that a class action is superior to other available methods
for fairly and efficiently adjudicating the controversy (known as the “superiority” requirement).
Fed. R. Civ. P. 23(b)(3).
Is the Class So Numerous That Joinder of All Members Is Impracticable?
Under Rule 23(a)(1), a class action is proper where “the class is so numerous that joinder
of all members is impracticable.” Fed. R. Civ. P. 23(a)(1). Although this provision is often
referred to as the “numerosity” requirement, the Fifth Circuit has made clear “that ‘the number
of members in a proposed class is not determinative of whether joinder is impracticable.’ “ In re
TWL Corp., 712 F.3d 886, 894 (5th Cir. 2013) (quoting Mullen v. Treasure Chest Casino, LLC,
186 F.3d 620, 624 (5th Cir.1999)). Because there is no definite standard as to what number of
class members will satisfy Rule 23(a)(1), the Fifth Circuit has “counseled that ‘courts must not
focus on sheer numbers alone.’ “ TWL, 712 F.3d at 894 (quoting Pederson v. La. State Univ.,
213 F.3d 858, 868 n. 11 (5th Cir.2000)). Instead, in assessing whether Rule 23(a)(1) has been
met, a court must consider all factors bearing on the practicability of joinder, including “the
geographical dispersion of the class, the ease with which class members may be identified, the
nature of the action, and the size of each plaintiff’s claim.” TWL, 712 F.3d at 894 (internal
quotation marks omitted).
Here, plaintiffs have made virtually no showing regarding the practicality of joinder. As
to the first proposed class (individuals working for GIS with E-2 or B-1/OCS visas under
contracts with D&R or V Offshore, Ltd.), plaintiffs submit only the deposition testimony of
Mark Pregeant, II, who estimated that the total number of Filipino workers (hired through
subcontractors) to work at GIS since 2006 “would have been, I don’t know, close to 600 or so,
probably. Like 500.” Rec. Doc. 401-14 at 156-57. In their reply brief, plaintiffs also point to
deposition testimony by Lester Lumba for the proposition that “GIS receives approximately 200
Filipino employees from DNR each year.” Rec. Doc. 517 at 63. However, in the actual
testimony, Mr. Lumba is emphatic that the number is less than 200 because many workers
deploy twice or even three times per year, and would be counted multiple times in that number.
Rec. Doc. 401-14 at 379-80. Moreover, even if the witness had not undermined the reliability of
the number, the plaintiffs have provided the Court with no basis for converting the “per year”
number into a reliable estimate of class size. Throughout the litigation, the parties have
submitted evidence showing that many of these workers re-enlist repeatedly. Thus, plaintiffs
have provided equivocal “guess-timates” as to class size.
Regarding other factors bearing on the practicability of joinder, the plaintiffs argue
(without pointing to any evidentiary support) that “most” of the putative class reside in the
Philippines and “many” are working elsewhere on overseas visas. Rec. Doc. 401-1 at 28 of 51.
They do not address other factors, such as the ease with which class members may be identified,
presumably because these factors would weigh against a finding that joinder is impractical. As
former and current employees of the defendants, the putative class members would be easy to
In their reply memorandum, the plaintiffs gloss over numerosity, noting that only two
defendants have challenged the plaintiffs’ showing in this regard. However, the burden is on the
plaintiffs to show that each requirement is met, and the evidence must be sufficient to support a
finding by the Court regardless of whether any defendant submits evidence to the contrary. See
Berger, 257 F.3d at 481-82. Given the plaintiffs’ equivocal evidence regarding class size and
utter failure to make a showing regarding other factors bearing on the practicability of joinder,
the Court is unable to make a finding that Rule 23(a)(1) is met as to the first class.
The plaintiffs’ showing is even weaker regarding the second proposed class (individuals
working for GIS under H2-B visas). Although the number of persons in the class is more firm
and reliable,2 it is a small number. See TWL, 712 F.3d at 895 (noting that even “[o]utside the
bankruptcy context, a putative class with only 130 members already might present a close
question as to numerosity, depending on the particular circumstances of the case”). Only 48
individuals meet the class definition. Especially given the plaintiffs’ failure to make a showing
regarding the other factors bearing on the practicability of joinder and given that these 48
workers are easily identifiable,3 the Court finds that the second proposed class fails to satisfy the
requirements of Rule 23(a)(1).
Mark Pregeant testified that GIS hired H2-B workers in only one year (2008), and that
they hired 48 such workers. Rec. Doc. 401-14 at 137.
As with the first proposed class, plaintiffs offer no evidence regarding other factors
bearing on the practicability of joinder. See discussion supra. They argue that “most” of the
putative class reside in the Philippines and “many” are working elsewhere on overseas visas, but
they do not attempt to state how many are dispersed outside the Philippines and point to no
evidence in this regard. See Rec. Doc. 401-1 at 18.
Are There Questions of Law or Fact Common to the Class?
A class may be certified under Rule 23 only if “there are questions of law or fact
common to the class.” Fed. R. Civ. P. 23(a)(2). As the Supreme Court has observed, the
language of Rule 23(a)(2) “is easy to misread,” because “[a]ny competently crafted class
complaint literally raises common ‘questions.’ ” Dukes, 131 S. Ct. at 2551 (internal quotation
marks omitted). Yet many so-called “common” questions are such that they would give a court
“no cause to believe” that all class member’s claims could be “productively be litigated at once.”
Id. “What matters to class certification ... is not the raising of common ‘questions’ — even in
droves — but, rather the capacity of a classwide proceeding to generate common answers apt to
drive the resolution of the litigation.” Id. (citation omitted). Rule 23(a)(2) requires a specific
kind of commonality:
Each class member’s claim “must depend upon a common contention”
and this “common contention, moreover, must be of such a nature that it is capable of classwide
resolution — which means that determination of its truth or falsity will resolve an issue that is
central to the validity of each one of the claims in one stroke.” Id. (emphasis added);
Stuckenberg, 675 F.3d at 840-41.
Plaintiffs argues that the breach-of-contract proposed classes satisfy the commonality
requirement of Rule 23(a)(2) because they present the following questions, which plaintiffs
maintain are common to the class: (1) Whether the class members all signed form employment
contracts, and whether under applicable Louisiana law those contracts incorporate the
protections of the FLSA; (2) Whether GIS, D&R, and V Offshore are or were joint employers;
(3) Whether GIS’s policy and practice of not paying the employees for their pre-shift waiting
and preparation time fails to pay the workers for all hours worked in violation of their contracts;
(4) Whether GIS’s policy and practice of not paying for post-shift doffing and clean up time fails
to pay the workers for all hours worked in violation of their contracts; (5) Whether GIS’s policy
and practice of not paying the Filipino workers for their travel time fails to pay the workers for
all hours worked in violation of their contracts; (6) Whether GIS has failed to adopt a policy
against off-the-clock work or implement adequate procedures to ensure that the Filipino workers
are paid for all hours worked; (7) Whether GIS, D&R, and V Offshore breached the covenant of
good faith by violating the class members’ contracts with a dishonest or morally questionable
To recover for breach of contract, a plaintiff must establish the following essential
elements: (1) that the obligor undertook an obligation to perform; (2) that the obligor failed to
perform the obligation, and (3) that such failure to perform resulted in damages to the obligee.
See Favrot v. Favrot, 68 So. 2d 1099, 1108-09 (La. Ct. App. 4th Cir.), writ denied, 62 So.3d 127
(La. 2011). Most of the plaintiffs’ proffered common questions fail the test for commonality
under Dukes. First, nearly all of the questions present inquiries that are on their faces
individualized, such that they could not possibly generate a common answer “in one stroke.”
For example, answering the plaintiffs’ first “common” question (whether each class member
signed a form employment contract) obviously entails multiple individualized inquiries, an
examination of the contract(s) signed by each class member, and an answer on behalf of each.
As a threshold matter, defendants argue that plaintiffs’ common “breach-of-contract”
issues are actually disguised FLSA claims, which cannot be certified under Rule 23, but rather,
are limited to procedures for collective actions provided in the FLSA. See, e.g., Rec. Doc. 473 at
13-14. The Court will address this argument in connection with the superiority requirement
Likewise, the common answers produced by questions 3, 4, 5 and 6 are relevant only in
the theoretical realm. The existence vel non of a GIS practice or policy is pertinent to the
validity of a particular class member’s breach-of-contract claim only to the extent it is shown to
have resulted in a failure to perform an obligation owed to that class member. Thus, for each
member’s breach-of-contract claim the determinative question is whether the relevant defendants
failed to pay him for work performed as agreed upon in the parties’ contract. This necessarily
entails an individualized inquiry into the terms of each class member’s contract(s) and the
particular circumstances of his employment. As the defendants have shown, these contracts and
circumstances vary greatly among the putative class members. Some class members work under
land-based contracts, others under seafarers’ contracts, the terms of which are quite different.
Some positions require the use of protective clothing; others do not. Some workers have to
travel considerable distances to their job sites, others do not. Some are paid for travel; others are
not. Some are paid for a set number of hours even if they work fewer hours. See Rec. Docs. 473
at 13-21 and 522 at 5-11 and materials cited therein. Thus a “yes” or “no” answer to questions 3,
4, 5 and 6 will not “resolve an issue that is central to the validity of each one of the claims in one
stroke.” Dukes, 131 S. Ct. at 2551 (emphasis added). Regardless of the answer, the individual
circumstances of each class member’s employment must be examined to determine whether the
defendants failed to perform an obligation owed to a particular class member.
Nevertheless, although most of plaintiffs’ proffered questions fail to pass muster under
Dukes, the Court finds that the commonality requirement has been met, for the plaintiffs have
articulated at least one issue (a purely legal one) which has the potential to determine the validity
of each class member’s breach-of-contract claim in one stroke: i.e., whether the employment
contracts entered into by the class members incorporate the protections of the FLSA by operation
of law. Because nearly all of plaintiffs’ breach-of-contract claims rest upon FLSA requirements
rather than express provisions of contract, it appears to the Court that a negative answer to this
question would dispose of all class members’ claims in one stroke, or at least certain aspects of
all class members’ claims. Granted, a positive answer to the question would lead the Court into
a morass of individualized inquiries, as discussed above. However, “the existence of even one
common question ... satisfies Rule 23(a)(2).” Ahmad v. Old Republic Nat. Title Ins. Co., 690
F.3d 698, 704 (5th Cir. 2012).
The Court recognizes that the plaintiffs have made arguments in their reply brief which
would appear to vitiate the relevance of whether FLSA terms are incorporated by law into class
members’ contracts. See discussion infra at 25-26. However, the Court need not waste time
parsing the question of whether plaintiffs have articulated even one common question, for the
truly determinative inquiry in this regard is whether the proposed class satisfies the
predominance requirement of Rule 23(b)(3). Indeed, in the Rule 23(b)(3) context, the
commonality requirement is said to be “subsumed under, or superseded by, the more stringent
Rule 23(b)(3) requirement that questions common to the class ‘predominate over’ other
questions.” Amchem Products, Inc. v. Windsor, 521 U.S. 591, 609 (1997); see also Ahmad, 690
F.3d at 702-04. Thus, it is appropriate for the Court to pretermit the commonality issue and
“train its attention on the ‘predominance’ inquiry.” Amchem, 521 U.S. at 609 (citing Georgine
v. Amchem Prods., Inc., 83 F.3d 610, 627 (3d Cir.1996)).
Are the Claims of the Class Representatives Typical of the Claims of the
Rule 23(a)(3) requires a finding that the claims of the class representatives “are typical of
the claims...of the class.” Fed. R. Civ. P. 23(a)(3). In this inquiry, the “focus is on the general
similarity of the named plaintiffs’ legal and remedial theories and the legal and remedial theories
of those whom they purport to represent.” In re Ford Motor Co. Bronco II Product Liability
Litigation, 177 F.R.D. 360, 366-67 (E.D. La. 1997) (quoting Jenkins v. Raymark Indus., Inc., 782
F.2d 468, 472 (5th Cir.1986)); Mullen v. Treasure Chest Casino, LLC, 186 F.3d 620, 625 (5th
Cir. 1999) (Typicality “focuses on the similarity between the named plaintiffs’ legal and
remedial theories and the theories of those whom they purport to represent.”), cert. denied, 528
U.S. 1159 (2000). A class representative’s “claim is ‘typical’ if it arises from the same event or
practice or course of conduct that gives rise to the claims of other class members, and if his or
her claims are based on the same legal theory.” Bronco II, 177 F.R.D. at 366 (citing 1 HERBERT
B. NEWBERG, ET AL, NEWBERG ON CLASS ACTIONS § 3–13 at 3–76 (3d ed. 1992)). “When it is
alleged that the same unlawful conduct was directed at or affected both the named plaintiff and
the class sought to be represented, the typicality requirement is usually met irrespective of
varying fact patterns which underlie individual claims.” In re Chinese-Manufactured Drywall
Products Liability Litigation, Slip Copy, 2013 WL 499474 *8 (E.D. La. 2013) (quoting
RUBINSTEIN, 1 NEWBERG ON CLASS ACTIONS § 3:13) (internal quotation marks omitted).
Plaintiffs argue that the claims of the proposed class representatives5 are typical of the
claims of the class “because they all arise out of GIS’ policies and procedures regarding
Plaintiffs seek to appoint Isidro Baricuatro and Rufino Orlanes as class representatives
of the E-2/B-1 OCS visa-holder class and Ricardo Ramos as class representative of the H2-B
compensating the employees, and Defendants’ failure to pay the employees for all hours
worked.” Rec. Doc. 401-1 at 39. Defendants point to the many factual differences in the
employments of the proposed class representatives and argue that these preclude a finding that
typicality is met. See Rec. Docs. 472 at 27-30, 522 at 11. However, the test for typicality
“focuses less on the relative strengths of the named and unnamed plaintiffs’ cases than on the
similarity of the legal and remedial theories behind their claims.” Jenkins v. Raymark Industries,
Inc.,782 F.2d 468, 472 (5th Cir. 1986). The legal and remedial theories relied upon by the
proposed class representatives are identical to those of all putative class members. Thus, the
Court finds the typicality requirement to be met. The many factual differences illustrated by the
defendants are better addressed in connection with the predominance and superiority inquiries
Will the Class Representatives Fairly and Adequately Protect the Interests of
Rule 23(a)(4) requires a finding that “the representative parties will fairly and adequately
protect the interests of the class.” Fed. R. Civ. P. 23(a)(4). The adequacy requirement
“encompasses class representatives, their counsel, and the relationship between the two.”
Berger, 257 F.3d at 479. It “mandates an inquiry into  the zeal and competence of the
representative[s’] counsel and ...  the willingness and ability of the representative[s] to take an
active role in and control the litigation and to protect the interests of absentees[.]” Id. (quoting
Horton v. Goose Creek Indep. Sch. Dist., 690 F.2d 470, 484 (5th Cir.1982)) (internal quotation
marks omitted). To be found “willing” and “able” to protect the interests of the class, the
proposed class representatives must “possess a sufficient level of knowledge and understanding
to be capable of ‘controlling’ or ‘prosecuting’ the litigation.” Id. at 482-83.6
The adequacy inquiry also “ ‘serves to uncover conflicts of interest between the named
plaintiffs and the class they seek to represent.’ “ Id. at 479-80 (quoting Amchem, 521 U.S. at
625). Throughout the inquiry, the Court must remain cognizant of “the constitutional
dimensions of the adequacy requirement.” Id. at 481. “[B]ecause absent class members are
conclusively bound by the judgment in any class action brought on their behalf, the court must
be especially vigilant to ensure that the due process rights of all class members are safeguarded
through adequate representation at all times.” Id. at 480. “Differences between named plaintiffs
and class members render the named plaintiffs inadequate representatives only where those
differences create conflicts between the named plaintiffs’ and the class members’ interests.” Id.
The defendants argue that the plaintiffs have failed to establish the adequacy requirement
because they have presented no evidence demonstrating the adequacy of the putative class
representatives. Defendants also suggest that certain facts attendant to the class representatives’
claims7 create a conflict between the proposed class representatives and the putative class
Although the Berger court noted that the Private Securities Litigation Reform Act of
1995 (“PSLRA”) “raises the standard adequacy threshold,” 257 F.3d at 483, the requirements
discussed herein (e.g., that class representatives “possess a sufficient level of knowledge and
understanding to be capable of ‘controlling’ or ‘prosecuting’ the litigation”) are part of the
“long-established” generic standard of establishing adequacy under Rule 23(a)(4), and are not
derived from the PSLRA. See Feder v. Electronic Data Systems Corp., 429 F.3d 125, 129-30
(5th Cir. 2005) (quoting Berger v. Compaq Computer Corp., 279 F.3d 313, 313–14 (5th
For example, defendants point out that: (1) Isidro Baricuatro had testified in his
deposition that defendants did not breach his employment contracts; (2) Ricardo Ramos has
released his claims by executing a quitclaim deed of release; and (3) Rufino Orlanes and Ricardo
members which precludes a finding of adequacy. The Court need not decide whether the
differences between the proposed class representatives and class members are sufficient to create
a conflict of interest, for the plaintiffs have pointed the Court to no evidence whatsoever that any
of the three proposed class representatives “possess a sufficient level of knowledge and
understanding” to take an active role in controlling the litigation and prosecuting it in a manner
that will protect the interests of all class members. Berger, 257 F.3d at 482-83. Thus, they
have failed to carry their burden of demonstrating that Rule 23(a)(4) is satisfied.
Do Questions Common to the Class Predominate Over Questions Affecting
Only Individual Members?
A class may be certified under Rule 23(b)(3) only if “the court finds that the questions of
law and fact common to class members predominate over any questions affecting only individual
members.” Fed. R. Civ. P. 23(b)(3). This is known as the predominance inquiry.
Although the existence of even one common question satisfies the commonality
requirement of Rule 23(a)(2), the predominance inquiry of Rule 23(b)(3) is “far more
demanding.” Funeral Consumers Alliance, Inc. v. Service Corp. Intern., 695 F.3d 330, 348 (5th
Cir. 2012). The predominance inquiry requires courts “to consider how a trial on the merits
would be conducted if a class were certified.” Id. at 348 (citations and internal quotations
omitted). Thus, it “‘entails identifying the substantive issues that will control the outcome,
assessing which issues will predominate, and then determining whether the issues are common to
the class,’ a process that ultimately ‘prevents the class from degenerating into a series of
individual trials.’ “ Madison, 637 F.3d at 555 (quoting O’Sullivan v. Countrywide Home Loans,
Inc., 319 F.3d 732, 738 (5th Cir. 2003)); Ahmad v. Old Republic Nat. Title Ins. Co., 690 F.3d 698,
Ramos entered into arbitration agreements. Rec. Doc. 473 at 32.
702 (5th Cir. 2012). The inquiry must probe beyond the pleadings, for the Court “must
understand the claims, defenses, relevant facts, and applicable substantive law.” Madison, 637
F.3d at 555; O’Sullivan, 319 F.3d at 738. Of course, the test for whether an issue is common to
the class is that enunciated in Dukes, discussed supra. See Ahmad, 690 F.3d at 702.
The Court finds that the plaintiffs have failed to meet their burden with respect to
predominance. First, as discussed above in connection with commonality, nearly all of the
common questions proffered by the plaintiffs fail the test for commonality set forth in Dukes.
They either necessarily entail individualized inquiries and thus do not yield common answers, or
they are common only in a theoretical sense, with their answers failing to decide in one stroke
any inquiry that is central to liability for breach of contract. See discussion supra at 10-11. The
existence of a GIS practice or policy is central to the validity of a particular class member’s
breach-of-contract claim only to the extent it resulted in a failure to perform an obligation owed
to that class member.
Second, even if the Court were to count all of the plaintiffs’ proffered questions as truly
common questions (despite their failure to satisfy Dukes), they would still be swamped by the
overwhelming number of individual factual inquiries inherent in litigating the breach of contract
claims. For example, a threshold issue will be whether a valid contract exists between the class
member and a defendant. This will entail individualized inquiries, as will the question of
determining the terms of a class member’s contract. See Rec. Docs. 473 at 13-21 and 522 at 511 and materials cited therein. Determining failure to perform (i.e., breach) will also necessarily
entail consideration of the individual circumstances of the particular class member’s
employment, including wages and benefits paid, travel time to various work sites, the duration of
shifts on various work assignments, and the equipment required for particular work assignments,
just to name a few. The importance of such questions is not confined to quantification of
damages. They are central to the determination of liability. Even if the plaintiffs were content
to rest their liability case after presenting only evidence of the defendants’ general practices
(which evidence at this point is thin indeed), it is clear that the defendants intend to ground their
defense against the breach-of- contract claims in the individual circumstances of each class
member’s employment. See id. Thus, the Court finds that the individualized questions raised by
defendants will predominate over the common questions proffered by the plaintiffs, both in
terms of number and more importantly, in the amount of trial and pretrial time and resources
Third, in addition to these individualized fact questions, the defendants point out several
questions of law that are not common to the class. For example, the employment contracts of
certain class members expressly call for the application of Philippine law, while others do not.
The employment contracts of some class members requires resolution of disputes by arbitration;
others do not. Some class members have executed quitclaim deeds purporting to release their
claims against the defendants; others have not. Such questions have already consumed the vast
majority of the Court’s time and efforts, and they will continue to do so regardless of
certification, for the contractual relationships are not uniform across the putative class. Even if
the terms of the FLSA are imputed by law into all of the contracts (which has not been decided),
For the same reasons, this holding applies equally to claims for breach of the duty of
good faith and fair dealing, for they rely upon the same disparate circumstances as the breach of
contract claims. See Maldonado v. Ochsner, 237 F.R.D. 145, 154 (E.D. La. 2006), aff’d, 493
F.3d 521 (5th Cir. 2007); In re Katrina Canal Breaches Consolidated Litigation, 2009 WL
1707923 *7 (E.D. La. 2009). Even accepting plaintiffs’ argument that only the defendants’
conduct and intent is pertinent to these claims, the plaintiffs have brought these claims against
multiple defendants acting through multiple agents, thereby necessitating individualized
analyses. Canal Breaches, 2009 WL 1707923 at *7.
differences among the contracts will remain, will continue to govern the rights between the
parties, and will continue to have real legal consequences. Determining whether a class member
has agreed to arbitrate his claims (as the Court has already been required to determine for several
named plaintiffs)9 is a detailed, individualized inquiry that requires close scrutiny of the
agreements entered into by that individual. Determining whether a particular class member has
contractually released his claims likewise requires careful, individualized examination. Such
inquiries alone would render the proposed class action unworkable even if they arose only in a
minority of claims. Therefore, even if all other factors discussed herein favored certification
(which they do not), the Court likely would find predominance (and superiority) to be lacking
based on this consideration alone.
Fourth, when the issue of damages is brought into the mix, the predominance of
individualized issues over common ones is so overwhelming as to be beyond the bounds of
reasonable debate. Indeed, the plaintiffs do not contend otherwise. Instead, they recite the
mantra that individualized issues related to damages should be disregarded in determining
predominance and cannot preclude certification. See Rec. Docs. 401-1 at 30-31, 517 at 35.
However, while it is true that the need for individualized damage calculations need not always
preclude certification,10 neither is it an impermissible consideration. Indeed, the Fifth Circuit has
repeatedly found 23(b)(3) certification precluded where, as here, individualized issues related to
damages predominate over class-wide issues. See, e.g., O’Sullivan, 319 F.3d at 744-45 (district
See Rec. Docs. 330, 440 and 447.
See Bertulli v. Indep. Ass’n of Cont’l Pilots, 242 F.3d 290, 298 (5th Cir.2001)
(affirming certification where “calculating damages w[ould] require some individualized
determinations” but “virtually every issue prior to damages [wa]s a common issue” and “not all
of the relief require[d] individualized determination.”).
court abused its discretion in certifying class “[i]n light of the individual calculation of damages
that is required”); Ditcharo v. United Parcel Serv., Inc., 376 Fed. Appx. 432, 438-39 (5th Cir.
2010); Steering Comm. v. Exxon Mobil Corp., 461 F.3d 598, 602-03 (5th Cir. 2006). Thus, while
the Court has found individual issues in this case to predominate even without considering
damages, the overwhelming burden of adjudicating hundreds of individual damages claims11 is
yet one more reason why the proposed classes cannot succeed.
Is a Class Action Superior to Other Available Methods for Fairly and
Efficiently Adjudicating the Controversy?
Certification under Rule 23(b)(3) is appropriate only if it is established “that a class
action is superior to other available methods for fairly and efficiently adjudicating the
controversy.” Fed. R. Civ. P. 23(b)(3). Factors relevant to this finding include: “(A) the class
members’ interests in individually controlling the prosecution or defense of separate actions; (B)
the extent and nature of any litigation concerning the controversy already begun by or against
class members; (C) the desirability or undesirability of concentrating the litigation of the claims
in the particular forum; and (D) the likely difficulties in managing a class action.” Id.
These factors are “not meant to be exhaustive and the court has discretion to consider
whatever other factors it deems relevant to the determination.” TWL, 712 F.3d at 895 (quoting
Although plaintiffs have moved to bifurcate the trial of damages, they have not made
any showing as to how these issues would be tried, much less presented a manageable trial plan.
See Rec. Doc. 400-1 at 12-13. Instead, they gloss over this critical issue with a few blithe
platitudes and assurances that the Court “will have substantial discretion and flexibility in
crafting the procedures for adjudicating Phase II damages” and “need not decide at this juncture
precisely how it will handle the damages Phase.” Id. Such a “figure-it-out-as-we-go-along”
approach will not suffice, Madison, 637 F.3d at 557, and is in stark contrast to the detailed trial
plans and use of subclasses that have been found in some cases to overcome the problem of
individualized damages. See Watson v. Shell Oil Co., 979 F.2d 1014, 1017-18 (5th Cir. 1992).
CHARLES ALAN WRIGHT ET AL., FEDERAL PRACTICE AND PROCEDURE § 1777 (3d ed. 2005)); see
also Fed. R. Civ. P. 23(b)(3), advisory comm. note to 1966 amendment (“Factors (A)–(D) are
listed, non-exhaustively, as pertinent to the [predominance and superiority] findings.”) (emphasis
added). As the Fifth Circuit has observed, the superiority requirement “necessarily suggests a
comparative process.” TWL, 712 F.3d at 896. “This plain reading of the Rule is reinforced by
an associated advisory committee’s note, which states that the court ‘ought to assess the relative
advantages of alternative procedures for handling the total controversy.’ “ Id. (quoting Fed. R.
Civ. P. 23(b)(3) advisory comm. note to 1966 amendment).
Even if the proposed 23(b)(3) classes met every other requirement, they would
nonetheless fail, for they founder fatally on the superiority requirement. First, the likely
difficulties of managing the proposed class litigation weigh heavily against certification. Fed. R.
Civ. P. 23(b)(3)(D). A few of the likely difficulties have already been discussed supra in
connection with the predominance inquiry. The factual and legal issues requiring individual
determination are numerous, and the plaintiffs have proffered no serious plan for rendering their
adjudication manageable. Compounding these manageability problems is the fact that a majority
of putative class members reside in the Philippines, with others allegedly “dispersed around the
globe on overseas work visas.” Rec. Doc. 401-1 at 28. The plaintiffs do not meaningfully
address any of the difficulties inherent in managing these challenges, much less offer a
thoughtful, real-world plan for mitigating the problems.
Second, there are significant factors that weigh against the desirability of concentrating
the litigation of the claims in this particular forum. Fed. R. Civ. P. 23(b)(3)(C). As the Fifth
Circuit has explained, the superiority requirement “necessarily suggests a comparative process”
and “the court ‘ought to assess the relative advantages of alternative procedures for handling the
total controversy.’ “ TWL, 712 F.3d at 896 (quoting Fed. R. Civ. P. 23(b)(3) advisory comm.
note to 1966 amendment). Here, the proposed class purportedly consists of 500 to 600 Filipino
workers, most of whom reside in the Philippines. The defendants also include Filipino
individuals and companies based in the Philippines. Much ink has been spilled already in this
litigation regarding the extensive involvement of the Republic of the Philippines government,
through the Philippine Overseas Employment Administration (“POEA”), in supervising and
regulating the employment of Filipino workers in overseas positions. See, e.g., Rec. Doc. 330
and documents cited at note 1 therein. And the parties already have educated the Court
regarding the expansive authority of the Philippine National Labor Relations Commission
(NLRC”) (the Philippine labor court) to adjudicate any and all money claims arising out of any
law or contract involving Filipino workers in overseas employment. Cf. Lim v. Offshore
Specialty Fabricators, Inc., 404 F.3d 898, 908 (5th Cir. 2005) (citing Migrant Workers and
Overseas Filipino Act of 1995, Republic Act 8042, § 10 (2004), available at
http://www.poea.gov.ph/rules/ra8042.html) (“There is no reason to conclude the NLRC could
not consider an action arising under the FLSA, if that statute applies to plaintiffs’ claims.”).
Thus, in an analysis that requires a comparison of alternative means of adjudication, the question
necessarily arises whether a Rule 23 class action in this forum is superior to the procedures
established for adjudicating workers’ claims in the Philippines. Yet, the plaintiffs do not even
The defendants do raise it and point out the attendant concerns of international comity, as
well as logistical problems that have already occurred due to denial of visas for travel to this
forum. See Rec. Doc. 469 at 11-12 and n.5. Plaintiffs’ response to this argument is that
“Defendants proffer no evidence to support this contention” and that since class members
“typically” return to work at GIS for multiple contracts, “there is little reason to believe that a
class action proceeding in this forum would be inconvenient to them.” Rec. Doc. 517 at 50 of
72. This response fails to withstand even the most superficial scrutiny.12 Moreover, it turns the
Rule 23 burden on its head. The party seeking certification bears the burden of establishing that
each of Rule 23 requirements is met. Madison, 637 F.3d at 554-55; Berger, 257 F.3d at 481-82.
It is the plaintiffs’ burden to show that a class action in this forum is superior to alternative
procedures; not the defendants’ burden to demonstrate the contrary.
Finally, to the extent that the claims of the proposed classes rely upon the FLSA, a Rule
23(b)(3) class cannot as a matter of law constitute a superior means of fairly and efficiently
adjudicating such claims, for Congress has expressly mandated that representative actions
asserting claims for minimum wage and unpaid overtime proceed by the “opt-in” procedure
provided in 29 U.S.C. § 216(b). Thus, there is a “fundamental, irreconcilable difference”
between Rule 23 class actions and the collection actions provided for by the FLSA: the FLSA
class member are bound by the court’s judgment only if they “opt in,” whereas Rule 23(b)(3)
class members are bound by any class judgment unless they have timely “opted out.”
LaChapelle v. Owens-Illinois, Inc., 513 F.2d 286, 289 (5th Cir. 1975); compare 29 U.S.C. §
216(b) (“An action to recover the liability prescribed in either of the preceding sentences may be
Even assuming that 200 Filipino workers were deployed to GIS at one time, that
would still leave 300 to 400 putative class members in the Philippines or “dispersed around the
globe.” Rec. Doc. 401-1 at 28 of 51. It would seem obvious that this forum would be very
inconvenient to them; yet plaintiffs make no showing at all to address this concern.
maintained...by any one or more employees for and in behalf of himself or themselves and other
employees similarly situated. No employee shall be a party plaintiff to any such action unless he
gives his consent in writing to become such a party and such consent is filed in the court in
which such action is brought.”), with Fed. R. Civ. P. 23(c)(2)(B)(v) (notice to class members
must clearly state “that the court will exclude from the class any member who requests
exclusion”). The Fifth Circuit has been very clear: “Rule 23 cannot be invoked to circumvent
the consent requirement of the ... FLSA.” LaChapelle, 513 F.2d at 289.
Based upon the plaintiffs’ original motion papers, it appeared quite clear that the claims
of the proposed 23(b)(3) classes were directly dependent upon the provisions of the FLSA,
which plaintiffs’ argued, were incorporated by operation of law into each of the plaintiffs’
employment contracts. See Rec. Doc. 401-1 at 20-27. Indeed, the showing made by the
plaintiffs on the commonality requirement rested almost entirely on the FLSA and its
jurisprudence. As defendants pointed out in their opposition memorandum, in describing the
“common” contractual issues presented by the proposed 23(b)(3) classes, the plaintiffs did not
allege that the defendants had breached any specific terms of any employment contract. Rec.
Doc. 473 at 14. Rather, the plaintiffs’ claims rested on assertions that the defendants had
breached the employment contracts by violating the FLSA. Id. The backbone of plaintiffs’
commonality argument is as follows:
Under Louisiana state contract law, one of the material terms inherent in all the
contracts at issue here is the protections of the Fair Labor Standards Act
(“FLSA”). Indeed, it is well-settled that all employment contractual relationships
in Louisiana incorporate the FLSA protections as though written into the contract
itself.... See, e.g., Johnson v. Anderson-Dunham Concrete Co., 212 La. 276, 282, 31
So.2d 797, 799 (1947) (“When such an agreement [between the employer and the
employee] (the principal basis for the obligation) exists or comes into being the
Federal Wage and Hour Law becomes a part of it, just as if its provisions are
specifically included therein by the parties....).... Thus, the protections of the FLSA
are material terms of every single employment contract in this case without
exception. Class certification is particularly appropriate here because whether GIS’s
policies and practices have resulted in a breach of the material terms of its form
employment contracts—including the FLSA protections—is a common question that
can generate common answers regarding Defendants’ liability to the class as a
* * * *
GIS’s admitted policy and practice of not paying any of the employees for their pre-shift
preparation time are the same across the class and raise important common questions that
are capable of common answers. Under applicable FLSA precedents, which are
incorporated into Louisiana law as shown in Section III(B)(1) above, an employer is
obligated to pay its employees for all hours worked. ... This uniform policy and practice
raises important common questions as to whether pre-shift preparation time constitute
“work” hours within the meaning of the FLSA that should be recorded and paid by the
* * * *
Under applicable substantive law, GIS’s uniform policy and practice of not paying the
workers for doffing and clean up time after the conclusion of their shifts raises important
common questions that can give rise to common answers. With respect to post-shift
doffing and tool cleaning time, common questions are raised as to whether this time is
compensable under the FLSA and, by extension, the employees’ contracts under
* * * *
GIS uniformly fails to pay the workers for the time they are required to travel while
wearing their protective equipment on company vehicles between the bunkers and the
worksites. See discussion at II(H), supra. Under applicable law, whether travel time is
compensable turns on factors including, but not limited to, if the travel is mandated by
the employer, if the travel takes place in company vehicles, if the employees are unable
to use the time spent in the employer’s vehicles for other purposes, if the employees are
required to transfer their work tools in the vehicles to and from the worksites, and
whether the travel takes place between worksites under the employer’s control. See, e.g.,
Vega v. Gasper, 36 F.3d 417, 424-25 (5th Cir. 1994) [an FLSA case].
* * * *
Under the FLSA, an employer must pay for any work that it “suffers” or “permits” an
employee to perform, not just work that it “requires” or “instructs” its employees to
perform. .... An employer violates the FLSA if it has, or should have, knowledge that
off-the-clock work is being performed by its employees, and it fails to ensure that its
employees are accurately paid for that off-the-clock work. As discussed, the FLSA’s
legal standards are incorporated into the terms of the employees’ contracts.
* * * *
Under the FLSA, this time is compensable if the employer permits it, regardless of
whether the employees are willing to do it. Whether Defendants have a policy and
practice of permitting such work to happen regularly without compensation can be
shown by common proof. Moreover, under the FLSA, Defendants have an affirmative
obligation to accurately capture all the work time and pay the employees for it in full.
Rec. Doc. 401-1 at 30-36 of 51 (emphasis added).
In their opposition memoranda, defendants argue that a section 216(b) collective action
provides the exclusive avenue for representative actions on claims for violation of the FLSA and
argue that it is impermissible to use Rule 23 to circumvent the express requirements for
collective actions. See, e.g., Rec. Doc. 473 at 13-17 of 53 (citing LaChapelle, 513 F.2d at 289).
In response, plaintiffs make a dramatic about-face in their reply brief. Despite the lengthy
discussion in their original memorandum excerpted supra (explaining that the contract claims
present common class-wide questions because each class members contracts incorporate the
terms of the FLSA and practices in violation of such terms present questions common to the
class), plaintiffs chastize the defendants for “misstating” their contract claims as being dependant
on the FLSA. Rec. Doc. 517 at 20 of 72. In sharp contrast to the FLSA-based description
asserted in their original motion papers, the plaintiffs in their reply memorandum explain that
their contract claims (the basis of the proposed Rule 23(b)(3) classes) seek strictly to recover
“straight time,” a right not provided by the FLSA; whereas their FLSA claims (not included in
the Rule 23 classes) are for minimum wage and overtime only. Id. Thus, defendants’
characterization of the proposed class claims as duplicative of the claims asserted in the
collective action is, plaintiffs argue, misplaced. In addition, plaintiffs further argue that their
claims should fall outside the FLSA’s mandatory procedures for representative actions to the
extent that they are time-barred under the FLSA. See Rec. Doc. 517 at 22, 48 of 72 (“In
addition, many of the class member’s claims for off-the-clock overtime work are untimely under
the FLSA, and only a breach of contract action with Louisiana’s longer statute of limitations will
permit those class members any recovery.”).
Clearly, the mere co-existence of an FLSA collective action does not preclude the
assertion of wholly distinct state-law claims under Rule 23. 29 U.S.C. § 218. Thus, to the extent
that the proposed classes seek to enforce rights not provided for in the FLSA (e.g., claims for
straight time under the terms of their contracts), the already-certified FLSA collective action
would not be superior, as it does not include such claims. Consequently, as to such claims, the
proposed classes would not fail to meet the superiority requirement on this basis (although they
nonetheless fail to meet this requirement for the other reasons stated herein).13 However, to the
extent that they seek to recover for conduct made unlawful by the FLSA — i.e., failure to pay
minimum wage and overtime — the Court finds that the section 216(b) “opt-in” class provides
the exclusive and per se superior class vehicle when compared to a Rule 23(b)(3) class action.14
Indeed, because its claims would rest strictly on the terms of individual contracts and
not on the FLSA, a class pursuing only straight time claims would be even weaker on the
predominance issue than the discussion above reflects and would likely fail even to satisfy
commonality. See discussion in defendants’ sur-reply, Rec. Doc. 522 at 10-11 of 24 (“It is
nonsensical for Plaintiffs to argue that the hours and wage provisions of their employment
contracts were breached, and at the same time argue that determining these provisions is
unnecessary to resolve their contractual [straight time] claims.”).
Even if the Court did not find such claims to be preempted such that § 216(b) provides
the exclusive procedure for representative actions on such claims, the Court would still find the
collective action to be a superior means of litigating the claims given the progress of the
litigation already begun in the FLSA collective action certified by this Court. See Fed. R. Civ. P.
See Karna v. BP Corp. North America, Inc., 2013 WL 1155485 *201 (S.D. Tex. 2013)
(“common law claims are preempted by the FLSA to the extent the plaintiff seeks damages for
unpaid minimum wages or unpaid overtime compensation”); Newsom v. Carolina Logistics
Services, Inc., 2012 WL 3886127 *3 (N.D. Miss. 2012) (“claims...for overtime wages and
minimum wages on the basis of quantum meruit are preempted by the FLSA because the right to
such wages arises under the FLSA, and that Act affords a remedy for the same;” but claims for
straight time work “are not preempted”). To allow the plaintiffs to circumvent the statutory
consent (opt-in) requirement solely on the basis that class members’ overtime and/or minimum
wage claims are time-barred under the FLSA would be indeed repugnant to the FLSA. See
Karna, 2013 WL 1155485 at *21 (“the fact that state law causes of action may have more
generous statutes of limitations than the FLSA is an argument in favor of, not against,
Against all of these difficulties and obstacles, the only valid argument offered by
plaintiffs in favor of the Rule 23 class vehicle is that the claims are unlikely to be brought if the
class is not certified, given that the value of the individual claims is small, that nearly all putative
class members live overseas, and that those currently employed might be disinclined to sue their
employer. Although a valid concern that is not taken lightly, this factor is substantially
outweighed by the serious and numerous considerations militating against certification of the
Rule 23(b)(3) classes, as discussed above. Therefore, for all of these reasons, the plaintiff’s
motion will be denied as to the proposed Rule 23(b)(3) classes.
Proposed Rule 23(b)(2) Class Seeking Declaratory and Injunctive Relief for Alleged
Violations of RICO and the TVPA
Pursuant to Rule 23(b)(2), plaintiffs seek certification of a third class, asserting claims for
declaratory and injunctive relief addressing alleged violations of RICO and the TVPA. This
proposed class would comprise:
All individuals who are or will be employed by D&R Resources, LLC and
recruited by DNR Offshore Crewing Services to work for Grand Isle
Shipyard, Inc. under a visa from the Philippines.
See Rec. Doc. 401 at 2. The TVPA makes it a crime to knowingly obtain, provide, traffick in,
or financially benefit from forced labor — i.e., from labor that is secured by means of force or
physical restraint, threats of force or physical restraint, harm or threats of serious harm, abuse or
threatened abuse of legal process, or a scheme or plan intended to make a victim believe he or
she will suffer serious harm or physical restraint if labor or services are not performed. See 18
U.S.C. §§ 1589 et seq. The Act also provides a limited civil remedy. 18 U.S.C. § 1595.
“Here, ... Plaintiffs’ TVPA claims are based exclusively on Defendants’ [alleged] pattern
and practice of threatening the Filipino work force with deportation.” See Rec. Doc. 517 at 69 of
72 (emphasis added). “Plaintiffs here do not contend that they were forced to stay at GIS and
work against their will generally as a result of the threats of deportation. They claim only that
they were compelled by threats of deportation to provide labor that they would not otherwise
have provided, including excessive hours beyond that required by their contracts and numerous
unpaid work hours.” Rec. Doc. 517 at 70 of 72. The relief sought by the class is an injunction
“prohibiting Defendants from threatening Filipino workers with deportation as a means of
extracting labor from them in excess of their contracts or without compensation.” Id.
“Rule 23(b)(2) allows class treatment when the party opposing the class has acted or
refused to act on grounds that apply generally to the class, so that final injunctive relief or
corresponding declaratory relief is appropriate respecting the class as a whole.” Dukes, 131 S.
Ct. at 2557 (citation and internal quotations omitted); Fed. R. Civ. P. 23(b)(2). “The key to the
(b)(2) class is ‘the indivisible nature of the injunctive or declaratory remedy warranted—the
notion that the conduct is such that it can be enjoined or declared unlawful only as to all of the
class members or as to none of them.” Id. (citation and internal quotations omitted). “In other
words, Rule 23(b)(2) applies only when a single injunction or declaratory judgment would
provide relief to each member of the class.” Id. “It does not authorize class certification when
each individual class member would be entitled to a different injunction or declaratory judgment
against the defendant. Similarly, it does not authorize class certification when each class
member would be entitled to an individualized award of monetary damages.” Id.; see also
Stukenberg, 675 F.3d at 845; Casa Orlando Apartments, Ltd. v. Fed. Nat’l Mortg. Ass’n, 624
F.3d 185, 198 (5th Cir.2010) (Rule 23(b)(2) “seeks to redress what are really group as opposed
to individual injuries. The uniformity of the injury across the class is what renders the notice and
opt-out provisions of (b)(3) unnecessary.” ) (citation omitted).
Of course, to be certified under Rule 23(b)(2), a class must first satisfy the requirements
of Rule 23(a). Here, the defendants do not seriously challenge numerosity, and while they
assert arguments against commonality and typicality, these arguments are more properly directed
to the adequacy inquiry and to questions inherent in Rule 23(b)(2), which are discussed infra.
Do the Class Representatives Have Standing and Will They Fairly and
Adequately Protect the Interests of the Class?
In their motion for class certification, the plaintiffs seek appointment of three individuals
as class representatives for members of the proposed Rule 23(b)(2) class: (1) Samuel Nora; (2)
Noel Mallari; and (3) Michael Dalire. Rec. Docs. 401 at 2, 401-1 at 37. The defendants have
asserted several grounds for questioning whether these men can fairly and adequately protect the
interest of other class members: (1) Dalire is an opt-in plaintiff in the FLSA action, but has not
even asserted RICO or TVPA claims; (2) Dalire and Mallari were recently compelled to arbitrate
claims against DNR; (3) none of the men meet the class definition, as none is a current employee
of any defendant and none has demonstrated a likelihood of being re-hired in the near future; (4)
Nora and Mallari have both signed releases; (5) none of the men has personally suffered the
threat of injury asserted by the class (i.e., being threatened with deportation and/or forced to
work against their will); (6) Nora and Mallari have given deposition testimony demonstrating a
serious lack of knowledge and understanding regarding the claims of the class and their duties as
class representatives;15 and (7) Dalire recently contacted GIS and asked to withdraw his claims in
In response, plaintiffs (in a footnote in their reply memorandum) have withdrawn
Michael Dalire and Noel Mallari as proposed class representatives. See Rec. Doc. 517 at note
30. Thus, only Samuel Nora remains. Pretermitting the question of whether the release signed
by Nora is valid, the plaintiffs have failed to demonstrate that Nora “possess[es] a sufficient level
of knowledge and understanding” to take an active role in controlling the litigation and
See Rec. Docs. 468-7 at 7 of 41, 23 of 41; 468-8 at 5 of 47.
prosecuting it in a manner that will protect the interests of all class members. Berger, 257 F.3d
at 482-83. Indeed, his deposition testimony suggests strongly that he understands neither the
TVPA claims being asserted by the class nor his role as a class representative. Rec. Doc. 468-7
at 7 of 41, 23 of 41. Also troubling is the fact that he signed his declaration without reading it or
having it explained to him. See Rec. Doc. 468-7 at 18 of 41. Moreover, there are serious doubts
as to whether he will be able to actively participate in litigating the class action, as he was unable
to obtain a visa to travel to the United States even for the purpose of giving a deposition. See
Rec. Doc. 468-7 at 6-7 of 41.
Finally, and perhaps most importantly, Nora does not meet the class definition, as he is
not a current employee of any defendant and plaintiffs have failed to demonstrate a likelihood
that he will be re-hired. See Rec. Doc. 401 at 2 (defining Rule 23(b)(2) class as: “All
individuals who are or will be employed by [D&R] and recruited by [DNR] to work for [GIS]
under a visa from the Philippines.”).
This last point has implications not only for Rule 23(a) adequacy, but also for Article III
standing. For Nora to have standing to bring the proposed claims for injunctive relief on behalf
of the class, plaintiffs must demonstrate a realistic threat that Nora will again be subjected to the
conduct sought to be enjoined. See City of Los Angeles v. Lyons, 461 U.S. 95, 107-110 (1983).
They have not done so. Although Nora signed a contract with DNR upon returning to the
Philippines and has testified that he is willing to return to work at GIS provided that the
circumstances there change (e.g., such that he be allowed to work fewer hours “if I don’t feel up
to it, or I just don’t want to.”),16 he has also testified that he has spoken to no one from DNR in
2013 and that no one is currently recruiting him to work for D&R or GIS.17 Thus, it would be
mere speculation to suppose that Nora will again be deployed to GIS.
The plaintiffs argue that this Court should follow cases wherein courts have permitted
class actions to proceed even where the class representative’s own personal claims have become
moot during the litigation.18 However, the issue here is not one of mootness but one of standing.
Because Nora has no realistic threat of future injury and had none when he first became a
plaintiff in February 2013,19 he lacks standing to bring a claim for injunctive relief and cannot
fairly represent a class based upon such a claim.20 Moreover, even if standing were not lacking,
See Rec. Doc. 401-23 at 17 of 46 (“...I would be willing to return and perform more
work for [GIS] if DNR Offshore contacted me...and if the circumstances changed.”) (emphasis
added); Rec. Doc. 468-7 at 19 of 41 (“I will go back and work for them again if they would
correct what is right, like the right salary, they will give us the right salary....”) (emphasis
See Rec. Doc. 468-7 at 6 of 41.
See Rec. Doc. 517 at 60 of 72 (citing U.S. Parole Comm’n v. Geraghty, 455 U.S. 388,
398 (1980); Newby v. Johnston, 681 F.2d 1012, 1014 (5th Cir. 1982); Satterwhite v. City of
Greenville, 634 F.2d 231, 231-32 (5th Cir. 1981); Stewart v. Winter, 669 F.2d 328 (5th Cir.
See Rec. Docs. 311 at ¶ 35, 468-7 at 6 of 41 (stating Nora last worked at GIS in
August 2012, at which time he returned to the Philippines).
See, e.g., Ellis v. Costco Wholesale Corp., 657 F.3d 970, 986 (9th 2011) (“Plaintiffs not
employed by Costco throughout this case do not have standing to seek injunctive relief. As
former employees, [named class representatives] would not share an interest with class members
whose primary goal is to obtain injunctive relief. Thus, as the class currently stands, [they] will
not adequately protect the interests of the class as a whole.”); Drayton v. Western Auto Supply
Co., 2002 WL 32508918 *4-5 (11th Cir. 2002) (citing Jackson v. Motel 6 Multipurpose, Inc., 130
F.3d 999, 1007 (11th Cir.1997)); cf. Lujan v. Defenders of Wildlife, 504 U.S. 555, 564 (1992)
(“‘Past exposure to illegal conduct does not in itself show a present case or controversy
the plaintiffs have failed to demonstrate that Nora will adequately protect the interests of
absentee class members, given that he has no personal stake in the injunctive relief sought.
Nora has other problems relating to standing because he has given conflicting testimony
as to whether he was ever personally threatened with deportation while working at GIS. When
asked whether anyone ever threatened to deport him while employed by D&R, he answered
unequivocally: “Nobody did, no.” Rec. Doc. 468-7 at 19 of 41. Later, on questioning by
plaintiffs’ counsel, he stated: “When Randolf Malagapo called a meeting, he said to us when
somebody becomes reckless in his job or do something that’s against the rules, then we can get
deported.” Id. at 25 of 41. Even if the latter were interpreted as a threat against Nora,21 it falls
far short of supporting an inference that Nora ever provided labor that he otherwise would not
have provided in response to or otherwise because of a threat of deportation. Thus, the plaintiffs
have failed to establish that Nora ever suffered the injury sought to be redressed by the Rule
As a last resort, the plaintiffs argue that they should be allowed to name a substitute
representative. However, even if the proposed Rule 23(b)(2) class were otherwise meritorious
(which it is not, as discussed infra), the plaintiffs have failed to identify a single individual who
has standing and is qualified to fairly represent absent class members.
regarding injunctive relief ... if unaccompanied by any continuing, present adverse effects.’ “)
(quoting Lyons, 461 U.S. at 102 (quoting O’Shea v. Littleton, 414 U.S. 488, 495-96 (1974))).
Nora explained that the reckless behavior and rules violations referred to by Malagapo
were smoking in non-smoking areas of the oil and gas platforms, fighting on the platforms, and
walking on the highways instead of taking the company bus. Rec. Doc. 468-7 at 25 of 41.
Plaintiffs have pointed to no evidence that Nora personally had been engaging in any such
Does the Rule 23(b)(2) Class Impermissibly Include Individual Claims for
The Supreme Court has held that Rule 23(b)(2) “does not authorize class certification
when each class member would be entitled to an individualized award of monetary damages.”
Dukes, 131 S. Ct. at 2557. Here, plaintiffs have attempted to navigate around this requirement
by requesting certification of a class “seeking declaratory and injunctive relief only” for
violations of RICO and the TVPA. Rec. Docs. 400 at 2, 401-1 at 43 of 51. Noting this, the
defendants argue that this creates a conflict of interest between class representatives (each of
whom has preserved a non-class damages claim under RICO and TVPA) and the absent class
members. See Rec. Doc. 473 at 49-50, 52 of 53 (citing McClain v. Lufkin Indus., Inc., 519 F.3d
264, 283 (5th Cir. 2008) (affirming district court in “declin[ing] to certify the class under Rule
23(b)(2) because individual claims for monetary relief would have predominated [and]
conclud[ing] that the class representatives would be ‘inadequate’ if they dropped the class
members’ demand for compensatory and punitive damages in order to protect the
‘predominance’ of nonmonetary claims)); see also Dukes, 131 S. Ct. at 2560. In response,
plaintiffs argue that they have not sacrificed class members’ claims for damages but “[i]n
fact,...have expressly preserved the class member’s individual rights to pursue money damages
remedies, proposing that all of the class member’s individual damages claims be presented in
Phase Two....” Rec. Doc. 517 at 66 of 72. Plaintiffs cannot have it both ways.
First, plaintiffs’ argument is directly contrary to the proposed class definition, which
expressly limits the Rule 23(b)(2) class to those “seeking declaratory and injunctive relief only.”
Rec. Docs. 400 at 2, 401-1 at 43 of 51. Phase II, in plaintiffs’ motion to bifurcate, is designated
as a trial for class member damages on class and collective claims. Rec. Doc. 400 at 1.22 Thus,
by design, it would include only those claims certified as part of a Rule 23 class action or within
the FLSA collective action. To restate the obvious, plaintiffs have not sought class certification
of any TVPA or RICO monetary damages claims. Thus, monetary damages are not part of the
proposed class action (at least as it is defined in the original motion papers), either for collective
treatment or for bifurcated individual adjudication in a Phase II trial. Prior to their reply
memorandum, therefore, the plaintiffs had not “expressly preserved” the TVPA or RICO
monetary damage claims of absentee class members.
Second, if the Court accepts the plaintiffs’ attempt to redefine the Rule 23(b)(2) class, so
as to include absent class members’ individual claims for money damages for treatment in Phase
II, then the class runs afoul of the rule enunciated in Dukes that Rule 23(b)(2) “does not
authorize class certification when each class member would be entitled to an individualized
award of monetary damages.” Dukes, 131 S. Ct. at 2557.23 Plaintiffs do not dispute that class
members’ claims for money damages under RICO and the TVPA are individualized. Indeed,
they suggest that such claims “be presented in the Phase II damages proceedings,”24 which is
Phase III is designated for non-class claims of named plaintiffs. Rec. Doc. 401 at 1.
See Dukes, 131 S. Ct. at 2557-2561. In light of the text and structure of Rule 23(b), as
well as due process concerns, the Dukes court found “it clear that individualized monetary
claims belong in Rule 23(b)(3),” with its predominance and superiority requirements protecting
the rights of absentees, not in Rule 23(b)(2). Id. at 2558. Although it left open the question of
whether relief that is “incidental to requested injunctive or declaratory relief”— i.e., “damages
that flow directly from liability to the class as a whole on the claims forming the basis of the
injunctive or declaratory relief” and which do “not require additional hearings to resolve the
disparate merits of each individual’s case”—may be permissible under Rule 23(b)(2), the Court
expressly held that individualized damages claims are not. Dukes, 131 S. Ct. at 2560, 2557.
Rec. Doc. 517 at 66 of 72.
defined in plaintiffs’ proposed trial structure as determining “the amount of backpay and
damages owed to the individual class members” and addressing “the distinct issues of how much
time individuals actually worked under whatever policies are found to be unlawful in Phase I.”
Rec. Doc. 400-1 at 9 of 20. Thus, the damages claims here would be plainly prohibited under
Further supporting the conclusion that plaintiffs’ invocation of Rule 23(b)(2) is simply an
attempted end run around the predominance and superiority requirements of Rule 23(b)(3) is the
very real concern that injunctive and declaratory relief may not even be permissible remedies
under either the TVPA or RICO. The TVPA is primarily a criminal statute, which provides a
very limited and specific civil remedy: “An individual who is a victim of a violation may bring
a civil action against the perpetrator... and may recover damages and reasonable attorneys fees.”
18 U.S.C. § 1595(a). It is also “an ‘elemental canon’ of statutory construction that where a
statute expressly provides a remedy, courts must be especially reluctant to provide additional
remedies.” Karahalios v. National Federation of Federal Employees, Local 1263, 489 U.S.
527, 533 (1989). “In such cases, ‘[i]n the absence of strong indicia of contrary congressional
intent,’ ” a court is “ ‘compelled to conclude that Congress provided precisely the remedies it
considered appropriate.’ ” Id. (quoting Middlesex County Sewerage Authority v. Sea Clammers,
453 U.S. 1, 15 (1981)).
Plaintiffs have produced no indicia of contrary congressional intent.
Thus, the Court must conclude that Congress provided exactly those civil remedies it deemed
appropriate: damages and attorney fees.
As for plaintiffs’ RICO claims, the Fifth Circuit has expressed “considerable doubt that
injunctive relief is available to private plaintiffs under RICO.” Bolin v. Sears, Roebuck & Co.,
231 F.3d 970, 977 n. 42 (5th Cir. 2000) (citing Conkling v. Turner, 18 F.3d 1285, 1296 n. 8 (5th
Cir.1994) and In re Fredeman Litigation, 843 F.2d 821, 830 (5th Cir.1988). Moreover, even if
injunctive relief were available under RICO, plaintiffs have failed to explain how the RICO
statute relates to the specific claims of the Rule 23(b)(2) class as delineated by the plaintiffs. See
Rec. Doc. 517 at 69-70 of 72.
Lack of Classwide, Uniform Injury:
Rule 23(b)(2) applies only where the defendant “has acted...on grounds that apply
generally to the class.” Fed. R. Civ. P. 23(b)(2). Thus, to come under Rule 23(b)(2), the
targeted conduct much be “such that it can be enjoined or declared unlawful only as to all of the
class members or as to none of them.” Dukes, 131 S. Ct. at 2557. To meet this standard, an
alleged pattern or practice “must consist of a uniform policy allegedly applied against the
plaintiffs, not simply diverse acts in various circumstances.” Bolin v. Sears, Roebuck & Co.,
231 F.3d 970, 975 (5th Cir. 2000). “Certification is improper if the merits of the claim turns on
the defendant’s individual dealings with each plaintiff.” Id. Moreover, the injuries the class
seeks to redress must be group injuries “as opposed to individual injuries.” Bolin, 213 F.3d at
975 n.22. It is this “uniformity of the injury across the class” that “renders the notice and
opt-out provisions of (b)(3) unnecessary.” Id.
Defendants argue that plaintiffs have produced evidence of only particularized and
isolated threats of deportation — diverse acts in various circumstances — falling far short of the
uniform policy with uniformity of injury required under Rule 23(b)(2). The Court agrees.
Outside of cookie-cutter, lawyer-drafted declarations, the plaintiffs’ only evidence of deportation
threats relates to isolated instances by particular individuals, such as the meeting described by
Nora, wherein Malagapo warned employees that they could be deported for reckless behavior
and safety violations. See Rec. Doc. 468-7 at 25 of 41. Thus, for this additional reason, the
Court finds that the claims presented are not appropriate for certification under Rule 23(b)(2).
Plaintiffs’ Motion for Bifurcation under Rule 42(b):
To the extent that plaintiffs’ motion for separate trials relates to trial of Rule 23 class
issues, it is moot in light of the Court’s rulings on certification. Moreover, the Court agrees with
the defendants that the plaintiffs’ motion falls short of presenting a serious, workable trial plan.
Thus, for this reason, the motion will be denied without prejudice insofar as it relates to the
FLSA class claims. The parties shall confer and produce within thirty days a joint proposal for
adjudicating the FLSA claims. Accordingly;
IT IS ORDERED that;
Plaintiffs’ Motion for Class Certification Pursuant to Fed. R. Civ. P. 23
(Rec. Doc. 401) is hereby DENIED, and plaintiffs’ Motion for Separate
Trials of Claims and Issues Pursuant to FRCP 42(b) (Rec. Doc. 400) is
hereby DENIED WITHOUT PREJUDICE;
Counsel for the parties to the FLSA collective action shall confer and
submit within thirty (30) days a joint proposed trial plan for the FLSA
New Orleans, Louisiana, this 18th day of November, 2013.
KURT D. ENGELHARDT
UNITED STATES DISTRICT JUDGE
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