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George Gardner, Morris White, and Lawrence Carrington, Individually v. Western Beef Properties

February 16, 2012

GEORGE GARDNER, MORRIS WHITE, AND LAWRENCE CARRINGTON, INDIVIDUALLY AND ON BEHALF OF ALL OTHER PERSONS SIMILARLY SITUATED, PLAINTIFFS,
v.
WESTERN BEEF PROPERTIES, INC., ET AL., DEFENDANTS.



The opinion of the court was delivered by: Azrack, United States Magistrate Judge:

ORDER

In light of the denial of class certification of plaintiffs' state law claims, plaintiffs' counsel has requested permission to send the putative class members a letter advising them that the statute of limitations for those state laws claims is running. For the reasons stated below, that request is granted in part and denied in part.

BACKGROUND

On July 23, 2009, Judge Dearie preliminarily certified a collective action covering plaintiffs' claims under the federal Fair Labor Standards Act ("FLSA"). Although the statute of limitations for FLSA claims does not exceed three years, Judge Dearie permitted the collective action notice to be distributed to all salaried Managers and Assistant Managers employed by Western Beef, Inc., or Western Beef Retail, Inc. ("defendants") during the previous six years. New York Labor Law, under which plaintiffs were also pursuing a putative class action, provides for a six-year statute of limitations.

The collective action notice briefly refers to plaintiffs' state law claims. After explaining the FLSA's statute of limitations, the notice states:

In the future, should a class be certified for overtime claims arising from New York State law, those state law claims permit recovery within the prior (6) year period. As a result, this Notice of the Plaintiffs' federal and state law claims is being provided to all Managers and Assistant Managers employed during the 6-year period from July 23, 2003 to present.

The collective action notice was sent to approximately 334 persons who were employed by defendant during the previous six years. Approximately 45 of those employees opted into the collective action.

On September 26, 2011, I issued a report and recommendation recommending denial of plaintiffs' motion for class certification of their state law claims. Plaintiffs filed objections to that report and recommendation on October 7, 2011.

On November 16, 2011, plaintiffs' counsel requested permission to send a letter and a response card to the putative class members who did not opt into the collective action. Plaintiffs' counsel's proposed letter seeks to inform the putative class members that even though they did not participate in the collective action, they may still be entitled to recover under state law. The letter also states that the putative class members have only a limited time to act on their state law claims.*fn1

On December 9, 2011, Judge Dearie adopted, with some supplementation, my report and recommendation. Among other things, Judge Dearie denied, without prejudice, "[p]laintiffs' alternative request for certification of a state-wide class of present or former employees . . . who hold or held the title 'Department Manager' of a department 'where they worked alone or with only one other employee.'" A review of the docket indicates that plaintiffs have not taken any action in this case since Judge Dearie's December 9, 2011, order.*fn2

DISCUSSION

Federal Rule of Civil Procedure 23(d) provides that "[i]n conducting an action under this rule, the court may issue orders that . . . require--to protect class members and fairly conduct the action--giving appropriate notice to some or all class members of . . . any step in the action." Fed. R. Civ. P. 23(d). "The Court's discretion in applying this provision is as broad as necessity and common sense would dictate, 'to fulfull [sic] requirements of due process,' and to give expression to the 'equitable powers' of federal courts in class action matters." Leist v. Tamco Enterps., Inc., No. 80 Civ. 4439, 1984 WL 2425, at *2 (S.D.N.Y. Apr. 3, 1984) (quoting Fed. R. Civ. P. 23 Advisory Committee Notes) (1966 Amendments)). However, the Advisory Committee Notes indicate that "[n]notice is available fundamentally [to protect class members and fairly conduct the action] and should not be used merely as a device for the undesirable solicitation of claims." Fed. R. Civ. P. 23 Advisory Committee Notes (1966 Amendments).

Under Rule 23(d), courts have the discretionary authority to order that putative class members be notified when class certification has been denied. Robinson v. First Nat. City Bank, 482 F. Supp. 92, 99--101 (S.D.N.Y. 1979); Puffer v. Allstate Ins. Co., 614 F. Supp. 2d 905 (N.D. Ill. 2009). Such notification is warranted if putative class members will be prejudiced absent notice. Robinson, 482 F. Supp. at 100--01; see also Puffer, 614 F. Supp. 2d at 911--12 (holding that even if a court is not convinced that putative class members would in fact be prejudiced, notice is still appropriate unless the court finds that the risk of prejudice is "nil"). Prejudice can arise if putative class members were aware of the class action; in such circumstances, the putative class members may forgo instituting individual suits in reliance on the class action. See Robinson, 482 F. Supp. at 100--01 (declining to require notice where putative class members did not receive individual notice and there was minimal publicity regarding class action).

In many instances, notice to putative class members that class certification has been denied may be unnecessary because, at that point in the proceedings, the putative class members likely have not yet learned of the putative class action and, therefore, cannot have relied on it to their detriment. Here, however, the putative class members were notified of the putative state law class action in the July 2009 collective action notice. At first blush, that would appear to be sufficient to establish the possibility of prejudice. Nonetheless, in the somewhat unique circumstances here, the risk of prejudice is so minimal that sending notice of the denial of class certification to all of the putative class members is not warranted. ...


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