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Sylvester v. Wintrust Financial Corporation

United States District Court, N.D. Illinois, Eastern Division

September 26, 2014

DAVID A. SYLVESTER, Plaintiff,
v.
WINTRUST FINANCIAL CORPORATION, et al., Defendants.

MEMORANDUM OPINION AND ORDER

JOHN J. THARP, Jr., District Judge.

This is an action for violations of the Fair Labor Standard Act ("FLSA") requirements that employers pay minimum wage and overtime to non-exempt employees who work more than 40 hours in a workweek. The plaintiffs are or were employed as loan originators by Wintrust Financial Corporation, Barrington Bank & Trust Company, N.A., and Wintrust Mortgage Corporation. They allege that the defendants improperly classified all of their loan originator employees as exempt from FLSA requirements based on the "outside sales" exemption, failed to pay them a minimum wage and overtime when they worked more than 40 hours in a workweek, and failed to maintain FLSA-mandated records.

Pending before the Court are two motions. The plaintiffs move for further equitable tolling of the FLSA statute of limitations and the defendants move to stay pending arbitration the claims of some 50 opt-in plaintiffs. In addition, the parties have submitted competing proposals to govern the scope of discovery given the conditional certification of the collective action. For the reasons stated below, the Court denies the motion to extend equitable tolling of the FLSA statute of limitations, grants the motion to stay as to opt-in plaintiffs who are subject to arbitration agreements, and sets forth certain parameters to govern the scope of discovery going forward.

I. Plaintiffs' Motion to Extend Tolling of the Statute of Limitations

Based on the parties' agreed motion, the Court previously tolled the running of the otherwise applicable FLSA statute of limitations from December 13, 2012, to February 15, 2013.[1] See Dkt. 54, 57, 59, and 62. In conjunction with their motion for conditional certification of a collective action, the plaintiffs subsequently moved to extend the equitable tolling of the statute of limitations for putative collective members who had not yet received notice of this action and an opportunity to opt in. The Court denied that motion without prejudice, concluding that it could not equitably toll the running of a statute of limitations as to individuals who were not yet parties to the case.[2] Dkt. 84 (2013 WL 5433593 (N.D. Ill. Sept. 30, 2013)) ("September 30 Order"). This ruling was predicated upon the Supreme Court's opinion in Genesis Healthcare Corp. v. Symczyk, 133 S.Ct. 1523 (2013), in which it made clear that potential opt-in plaintiffs to a collective action are not parties to the case until such time as they actually opt-in. Id. at 1529.

Following conditional certification and notice to potential parties, plaintiffs' counsel reports (and the docket reflects) that more than 100 individuals have opted into this case. Plaintiffs now move to further extend the period of tolling of the statute of limitations from February 15, 2013, to October 23, 2013, the date the last notice regarding the putative collective action was issued. They maintain that opt-in plaintiffs should not be prejudiced by the delay required to rule on the motion for conditional certification of the collective.[3] The defendants object to further tolling, arguing that the opt-in plaintiffs have not demonstrated that further tolling is appropriate.

As the Court observed in denying the plaintiffs' first motion to further extend the equitable tolling period beyond February 15, equitable tolling is an "extraordinary remedy, " Dkt. 89, at 2, which should be granted only when claimants have exercised due diligence in preserving their legal rights. See Wallace v. Kato, 549 U.S. 384, 396 (2007) (equitable tolling is "a rare remedy to be applied in unusual circumstances"); Irwin v. Dep't of Veterans Affairs, 498 U.S. 89, 96 (1990) ("Federal courts have typically extended equitable [tolling] relief only sparingly."); Obriecht v. Foster, 727 F.3d 744, 748 (7th Cir. 2013) ("Equitable tolling is an extraordinary remedy and so is rarely granted.") (internal quotation omitted). It is warranted only when the party has diligently pursued his or her rights and some extraordinary circumstance nevertheless prevented timely filing. Id. (citing Holland v. Florida, 560 U.S. 631, 649 (2010); see also McQuiggin v. Perkins, 133 S.Ct. 1924, 1931 (2013).

Neither the Seventh Circuit, nor any other court of appeals (so far as the parties or this Court have been able to identify) has addressed the question of whether the delay inherent in the presentation and consideration of a motion for conditional certification of a collective action, which is a prerequisite to the provision of notice to potential members of the putative collective, warrants equitable tolling of the FLSA statute of limitations. In support of their argument, the plaintiffs rely on Judge Hart's opinion in Bergman v. Kindred Healthcare, Inc., 949 F.Supp.2d 852 (N.D. Ill. 2013), and other district court opinions granting equitable tolling on the ground that a "long delay" in ruling on a conditional certification motion constitutes "an extraordinary circumstance that should not cause the opt-ins to lose out on the potential benefits of this lawsuit." Id. at 860-61 (citing district court opinions that have granted equitable tolling on this basis). But see Bitner v. Wyndham Vacation Resorts, Inc., ___ F.R.D. ___, 2014 WL 3698850, at *9 (W.D. Wis. July 25, 2014) (collecting cases granting and denying equitable tolling based on the delay necessary to rule on conditional certification motions).

This Court respectfully disagrees with Judge Hart's analysis in Bergman. As an initial matter, that a court may take months to rule on a fully briefed motion is (unfortunately) not extraordinary; it is, rather, the predictable and common consequence of crowded court dockets generally and the particular circumstances of any particular judge's docket specifically. Moreover, and putting aside potential differences in the complexity of such motions, clearly some period of time must be considered normal, rather than extraordinary, for a court to address a conditional certification motion. Garrison v. Conagra Foods Packaged Food, LLC, 2013 WL 1247649, at *5 (E.D. Ark. Mar. 27, 2013) ("there is nothing extraordinary about a motion for conditional certification and the delay in notice while that motion is pending"). What that period is, however, the plaintiffs do not say; they simply contend that the statute of limitations should be tolled for the entire period that a conditional certification motion is under consideration (indeed, they even seek tolling to cover a portion of the period during which briefing was proceeding). That contention is plainly not consistent with the requirement that timely filing have been prevented by an "extraordinary circumstance." "To hold otherwise would be to opine that equitable tolling should be granted in every § 216(b) case as a matter of course during the pendency of a conditional class certification request, thereby transforming this extraordinary remedy into a routine, automatic one." Longcrier v. HL-A Co., Inc., 595 F.Supp.2d 1218, 1244 (S.D. Ala. 2008).[4]

Even assuming arguendo that some portion of an unusually long delay in ruling on a conditional certification motion can constitute an extraordinary circumstance, the plaintiffs must-but cannot-also establish that opt-ins were prevented from joining the law suit by that delay. No ruling by this Court was necessary to permit the filing of another law suit or an opt-in notice in this suit; nothing prevented any former employee of the defendants from either filing their own law suit or filing an opt-in notice for this law suit before a ruling on the conditional certification motion was issued. Judge Hart's opinion in Bergman states that this argument "ignores the realities of FLSA claims, " 949 F.Supp.2d at 861, but does not explain why that is so. The plaintiff in this case filed his own law suit before anyone else obtained conditional certification of a collective action, and at least five other individuals opted in to this suit before the conditional certification order was granted.[5] How the absence of a conditional certification ruling prevented other potential plaintiffs from asserting their rights, but not these five, the motion does not explain. See, e.g., Bitner, 2014 WL 3698850, at *10 (delay in ruling did not prevent others from timely joining the law suit, as evidenced by opt-ins prior to issuance of notice); Greenstein v. Meredith Corp., 2013 WL 4028732, at *2 (D. Kan. Aug. 7, 2013) (rejecting request for equitable tolling, in part because the "opt-in plaintiffs have had the same notice of their rights and obligations available to them as did the named plaintiff in this case").

In asserting that the delay attendant to ruling on the conditional certification motion prevented them from asserting their rights, what the plaintiffs really mean is that potential opt-ins have no way to know of the filing of the putative collective action until notice is issued. That is not entirely true, [6] but is in any event irrelevant. The question is not whether delay in issuing notice prevented others from learning about this law suit but whether such delay prevented them from discovering their own claims once those claims accrued.[7] The plaintiffs assert that those who opted in within the period permitted by the conditional certification order exercised the required diligence because they did not sit on their rights once notified of the potential claim against the defendants. But nothing in FLSA suggests that once one plaintiff has asserted a claim against an employer, all other potential plaintiffs are relieved of their respective obligations to exercise their own diligence with respect to the investigation and/or assertion of their own claims against that employer. As the defendants point out, in asking the Court to issue a blanket tolling order, the opt-in plaintiffs effectively seek a ruling that none of them was on notice of a potential claim before they received notice of this law suit and their right to join it. The present motion provides no factual basis to support such a ruling.

Unquestionably, FLSA claims are vulnerable to the running statute of limitations but that is because Congress has not seen fit to toll the statute of limitations for putative collective members after the filing of a putative collective action. See 29 U.S.C. § 256(b). Congress plainly did not view the filing of a putative collective action to be an adequate reason to stop the clock on claims of other putative members of the collective, instead providing expressly that their cases "shall be considered to be commenced" on the date on which their own "written consent is filed." Id. Issuing a blanket order tolling the limitations period for all putative members of a collective until such time as they have been given notice of the collective action would effectively overturn Congress's view that the statute should run as to such individuals until they have filed an opt-in consent.

Accordingly, the plaintiffs' motion to further extend equitable tolling of the statute of limitations to October 23, 2013, is denied. The denial is without prejudice, however, to the claim of any individual plaintiff who may seek to invoke equitable tolling based on his or her own particular circumstances ...


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