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Wyms v. Staffing Solutions Southeast, Inc.

United States District Court, S.D. Illinois

October 28, 2016

HAROLD WYMS, individually and on behalf of all others similarly situated, Plaintiff,
v.
STAFFING SOLUTIONS SOUTHEAST, INC., Defendant.

          MEMORANDUM AND ORDER

          Michael J. Reagan United States District Court

         Staffing Solutions Southeast, Inc., which does business as ProLogistix, is a staffing company that places workers into temporary positions at various warehousing outfits and then pays them for the temporary work done for those companies. It placed Harold Wyms and a number of other forklift operators into jobs at an Edwardsville facility operated by another company, but allegedly didn't pay those workers enough for the time they worked there-the forklift operators were purportedly not paid for some of the preparatory work done at the start of their shifts. In 2015, Wyms filed a class and collective action complaint against ProLogistix, alleging that its failure to pay Wyms and other forklift operators for pre-shift work ran afoul of federal and state law.

         With the aid of Judge Frazier, the parties have settled this case, and Wyms has since submitted a motion for preliminary approval of the state class settlement, a motion for approval of the Fair Labor Standards Act settlement as to Wyms alone, a motion for notice approval, and a motion to certify the state class for settlement. Subject to the notice modifications laid out below, all of the motions will be granted.

         Background

         Harold Wyms was a forklift operator assigned and paid by ProLogistix, a staffing company, to work at a large warehousing facility in Edwardsville, Illinois that was previously operated by UTi Worldwide, Inc., and is now operated by Schenker, Inc. Wyms worked at the facility from March 2011 to July 2012 under the formal employ of ProLogistix. On June 9, 2015, Wyms filed a class action and collective action complaint against ProLogistix, claiming that it failed to pay him and other similar forklift operators for the time the workers spent locating forklifts, performing inspections, completing documents, and performing other pre-shift tasks, all in violation of the Fair Labor Standards Act and Illinois law. Wyms sought to represent an opt-in Fair Labor Standards Act collective action consisting of all ProLogistix forklift operators employed at the Edwardsville facility who consented to join the case, and he sought to represent a Rule 23 class on the Illinois state law claims consisting of all current and former forklift operators who worked at the same facility within the statute of limitations period.

         Early in the case, Wyms and ProLogistix explored a possible settlement. They served initial disclosures but stayed the lion's share of discovery, opting instead to exchange information needed to calculate the value of the class and collective claims. To further settlement, ProLogistix produced payroll and employment data for 855 forklift operators it employed at the Edwardsville facility during the time period allowed by the statute of limitations. Wyms then converted that data into spreadsheet calculations which it used to evaluate damages, and the parties attempted to negotiate a settlement. Those preliminary talks failed, so the parties requested a settlement conference before Magistrate Judge Frazier. Magistrate Judge Frazier's efforts were more fruitful, and the parties agreed to compromise and settle the case.

         After the settlement conference with Judge Frazier, the parties entered into an initial settlement agreement. That agreement said, among other things, that any member of the Illinois state law class action who didn't opt out of the settlement would release all of the claims that were brought in the suit or that could have been brought in the suit, including those raised under the Fair Labor Standards Act and those raised under Illinois law. The Court denied the motion for preliminary approval without prejudice in July 2016, flagging to the parties that the members of the Illinois class couldn't release their Fair Labor Standards Act claims merely by failing to opt out of the class action-the Fair Labor Standards Act puts forth an opt-in regime, so any person in the class who wished to settle their federal claim would need to opt in to the suit.

         In late July 2016, the parties met and conferred again concerning settlement, and then signed a revised agreement. The revised settlement agreement contemplates a settlement of the Illinois class claims; it excludes Fair Labor Standards Act claims from the ambit of the release for everyone but the named plaintiff, Harold Wyms. (Wyms, who has obviously opted into the suit, wants the Court to approve his own settlement of his federal claim.) The parties have agreed to settle the Illinois class members' state law wage and hour claims through a settlement fund created by ProLogistix in the amount of $100, 000.00, inclusive of attorneys' fees and costs, a service award to lead plaintiff Wyms, payroll taxes on a portion of the award allocated to wage recovery, and any administrative costs associated with the settlement. The fund will be distributed to class members based on an equitable formula linked to eligible weeks that each member worked during the class period and wage rates earned during that time period.

         After the parties entered into the revised settlement, Wyms filed a consent motion to certify a Rule 23 class action, as well as an unopposed motion for preliminary approval of the class action settlement, approval of the Fair Labor Standards Act settlement as to Wyms, and approval of the notice to be sent to the Illinois class members. All of those requests are now before the Court for review.

         Discussion

         The Court will begin with Wyms' motion to certify the Illinois state law class for settlement purposes. The fact that the parties have reached a settlement is a relevant consideration in any decision to certify a class for settlement purposes, Smith v. Sprint Comm. Co., 387 F.3d 612, 614 (7th Cir. 2004), but it isn't the only one-a court cannot “abandon the Federal Rules merely because a settlement seems fair, or even [because] the settlement is a ‘good deal.'” Uhl. v. Thoroughbred Technology & Telecommunications, Inc., 309 F.3d 978, 985 (7th Cir. 2002). Rather, to be entitled to class certification, a plaintiff like Wyms must satisfy each of the requirements of Federal Rule of Civil Procedure 23(a)-namely numerosity, commonality, typicality, and adequacy of representation-along with one subsection of Federal Rule of Civil Procedure 23(b). Harper v. Sheriff of Cook County, 581 F.3d 511, 513 (7th Cir. 2009).

         The parties have stipulated to a class comprised of “all current and former forklift operators employed by ProLogistix at the Edwardsville facilities from June 9, 2012 until the date the Court enters its order granting preliminary approval” of the settlement agreement, and that class clears Rule 23(a)(1)'s requirement that the proposed class be so numerous that joinder of all persons is impracticable. Although there is no bright line test for numerosity, courts typically deem joinder impracticable where the class members number forty or more. See Chandler v. S.W. Jeep-Eagle, Inc., 162 F.R.D. 302, 307 (N.D. Ill. 1995). In this case, there are 855 members of the class, and that's a large enough group to justify employing the class device.

         The class also clears the Rule 23 requirements that class members share common questions of law or fact and that the plaintiff's claim be typical of the class. A “common nucleus of operative fact is usually enough to satisfy the commonality requirement” of Rule 23, and that kind of nucleus is typically present when the defendants have “engaged in standardized conduct towards members of the proposed class.” Keele v. Wexler, 149 F.3d 589, 594 (7th Cir. 1998). All of the class members in this case held similar job positions, all of them were subject to the same time-keeping and payment policies, and all of them were purportedly subject to “ready to work” and “rounding” practices that deprived them of pay. Given that the same policies were applied to all of the class members, commonality is satisfied. In addition, since Wyms' claims are based on the same course of conduct and the same theory as the claims of the class members- namely a loss caused by ProLogistix' time-keeping practices-the typicality requirement is cleared. See Rosario v. Livaditis, 963 F.2d 1013, 1018 (7th Cir. 1992).

         Over and above the typicality, commonality, and numerosity requirements, Rule 23(a) also requires that the class representative be able to fairly and adequately protect the interests of the entire class. Class adequacy is composed of two parts: the adequacy of the named plaintiff's counsel and the adequacy of representation provided by the named plaintiff in protecting the different, separate, and distinct interests of the putative class members. Sec'y of Labor v. Fitzsimmons, 805 F.2d 682, 697 (7th Cir. 1986) (en banc). “The adequacy of representation prong is often concerned with avoiding ...


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