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Rottman v. Old Second Bancorp

August 25, 2010


The opinion of the court was delivered by: Elaine E. Bucklo United States District Judge


Plaintiffs Joseph and Roberta Rottman ("the Rottmans") have brought this action, individually and on behalf of all others similarly situated, against defendant Old Second Bancorp, Inc. ("Old Second"), alleging violations of the overtime and minimum wage provisions of the Fair Labor Standards Act ("FLSA," "the Act"), 29 U.S.C. § 201, et seq. They also assert claims individually against Old Second for common law promissory estoppel and fraudulent misrepresentation. The Rottmans have moved pursuant to section 16(b) of the FLSA, 29 U.S.C. § 216(b), to conditionally certify the suit as a collective action and to authorize their proposed class notice. For the reasons discussed below, the motion is granted.


The Rottmans are former home mortgage loan officers or "loan originators" employed by Old Second, a bank and trust company with branches throughout the State of Illinois. The Rottmans allege that Old Second has failed to pay them and other loan officers for overtime hours that they have worked during the past three years. Under the FLSA, "employers must pay overtime to employees working on an hourly basis." Kennedy v. Commonwealth Edison Co., 410 F.3d 365, 369 (7th Cir. 2005). The Act provides that "[i]f such an employee works more than 40 hours in a week, she must receive at least one and a half times her regular wage for every extra hour worked." Id. (citing See 29 U.S.C. § 207(a)(1)).

Section 16(b) of the FLSA "permits plaintiffs to bring a 'collective action' against an employer for unpaid overtime compensation on behalf of him or herself and 'other employees similarly situated.'" Hundt v. DirectSat USA, LLC, No. 08 C 7238, 2010 WL 2079585, at *2 (N.D. Ill. May 24, 2010) (citing 29 U.S.C. § 216(b)). Although "[n]either the FLSA nor the Seventh Circuit has set forth criteria for determining whether employees are 'similarly situated'... courts in this district and around the country have settled on a two-step procedure for dealing with collective actions under the FLSA." Id.

In conducting the first step of the inquiry, "[c]courts have interpreted the 'similarly situated' requirement... leniently." Anyere v. Wells Fargo, Co., Inc., No. 09 C 2769, 2010 WL 1542180, at *2 (N.D. Ill. April 10, 2010) (citations, quotation marks, and brackets omitted); Howard v. Securitas Security Services, USA Inc., No. 08 C 2746, 2009 WL 140126, at *5 (N.D. Ill. Jan. 20, 2009) ("[T]he court looks for no more than a 'minimal showing' of similarity."). "Plaintiffs do not have to show that the potential class members have identical positions for conditional certification to be granted; plaintiffs can be similarly situated for purposes of the FLSA even though there are distinctions in their job titles, functions, or pay." Jirak v. Abbott Laboratories, Inc., 566 F. Supp. 2d 845, 848-49 (N.D. Ill. 2008). Since the "similarly situated" standard is a liberal one, it "typically results in conditional certification of a representative class." Cameron-Grant v. Maxim Healthcare Services, Inc., 347 F.3d 1240, 1243 n.2 (11th Cir. 2003) (quotation marks omitted); Smallwood v. Illinois Bell Telephone Co., --- F. Supp. 2d ----, n.4 (N.D. Ill. 2010). "Although the inquiry is undemanding, the court is under no obligation, as it would be on a motion to dismiss, to accept the plaintiff's allegations as true." Hundt, 2010 WL 2079585, at *2 (brackets, citations and quotation marks omitted). "Rather, the court evaluates the record before it, including the defendant's oppositional affidavits, to determine whether the plaintiffs are similarly situated to other putative class members." Id.

After discovery, the court conducts the second, more stringent step of the inquiry. "Once it is known which employees will be part of the class, the Court must reevaluate the conditional certification to determine whether there is sufficient similarity between the named and opt-in plaintiffs to allow the matter to proceed to trial on a collective basis." Jirak, 566 F. Supp. 2d at 848 (quotation marks omitted). Specifically, "[a]t step two, the Court must consider: (1) whether the plaintiffs share similar or disparate employment settings; (2) whether affirmative defenses raised by the defendant would have to be individually applied to each plaintiff; and (3) any fairness and procedural concerns." Id. District courts have "wide discretion" to manage collective actions. Alvarez v. City of Chicago, 605 F.3d 445, 448 (7th Cir. 2010).


The Rottmans seek conditional certification of the following class:

All current and former residential mortgage loan originators employed by Old Second and/or its affiliates and subsidiaries within the previous three years. This class specifically includes all loan officers or loan originators who reported to a regional sales manager, but specifically excludes any loan originator which [sic] had the title of regional sales manager.

Pls.' Mot. for Cond. Certification at 10. Since this is the first step of the conditional certification inquiry, the Rottmans "need only make a modest factual showing sufficient to demonstrate that they and potential plaintiffs together were victims of a common policy or plan that violated the law." Smallwood v. Illinois Bell Telephone Co., No. 09 C 4072, 2010 WL 1838562, at *3 (N.D. Ill. May 6, 2010).

The Rottmans have passed this test. They have adduced evidence showing that Old Second loan officers were subject to the same basic loan-processing policies and requirements. Among other things, the Rottmans point to Old Second's so-called "Lock Policy," which sets forth requirements concerning loan approval and cancellation, and the use of Old Second's pricing engine. See Pls.' Mem., Ex. P. They have also cited evidence that all loan originators were required to be "on call" at all times to answer calls to Old Second's customer service line. See, e.g., Ex. H ¶ 14; Ex. I ¶ 14; Ex. J ¶ 13. The Rottmans have also produced evidence showing that Old Second misc1assified loan originators as exempt from the FLSA's overtime requirements and failed to pay them overtime when they worked more than forty hours per week. See, e.g., Ex. H ¶¶ 16-18; Ex. J ¶¶ 15-17.

Old Second opposes conditional certification on two grounds. The first is based on its contention that members of the proposed class are "outside salesmen" under the FLSA and are therefore exempt from the Act's overtime requirements. See 29 U.S.C. ยง213(a)(1). Under ...

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