92 Litigating CA Wage & Hour and Labor Code Class Actions (22nd Edition) Seyfarth Shaw LLP | www.seyfarth.com In most of these cases, however, a significant portion of the certified class did not lose any money or property as a result of the violation, but plaintiffs argue that the mere fact that some class members have no damages does not preclude certification. For example, significant numbers of employees may not have worked any overtime, or significant numbers of a meal period class may have actually been provided all of their meal periods. After Tobacco II, trial courts may still certify classes despite the existence of members of the class without any grounds for recovery.549 While this is largely the way the courts had handled class actions traditionally, if the California Supreme Court had adopted the position of the dissent in Tobacco II, it might have substantially undercut the ability to use the UCL as a vehicle for advancing Labor Code class actions.550 551 XIV. Class Action Fairness Act of 2005 A. The Purpose of the Act The Class Action Fairness Act of 2005 (“CAFA”) amended the federal diversity jurisdiction statute, 28 U.S.C. § 1332, to broaden the basis for federal diversity jurisdiction. In enacting the CAFA, Congress’s intent was to shift class action litigation from state courts to the federal courts.552 The most significant increase in filings of class actions has been in labor class actions.553 Most of these class actions are brought under either F.R.C.P. 23 or the Fair Labor Standards Act (FLSA).554 549 See Sav-On Drug Stores, Inc. v. Superior Court, 34 Cal. 4th 319, 333 (2004) (explaining that “a class action is not inappropriate simply because each member of the class may at some point be required to make an individual showing as to his or her eligibility for recovery or as to the amount of his or her damages”). 550 Nevertheless, the reforms instituted by Proposition 64 still do apply where the class representatives themselves lack any basis for recovery. See, e.g., Birdsong v. Apple, 590 F.3d 955, 959-62 (9th Cir. 2009) (dismissing putative class action where plaintiffs alleged that injury was possible, but failed to allege that they themselves suffered any actual harm). 551 Another key development in regard to the application of the UCL was the decision of the California Supreme Court in Sullivan v. Oracle Corp., 51 Cal. 4th 1191 (2011). Sullivan held that overtime work performed by out-of-state employees within California can serve as the basis for a claim under California’s FLSA claims by competition law. Cal. Bus. & Prof. Code § 17200 (“UCL”). But the Supreme Court also held that out-of-state employees working outside California cannot serve as the basis for a California UCL claim. 552 Federal Judicial Center, Impact of CAFA on the Federal Courts: Fourth Interim Report, at 1-2, Apr. 2008 (reporting a 72% increase in class action cases filed in the 88 district courts from January to June 2007 compared with July to December 2001). 553 Id. at 7. 554 Id. (reporting a 228 percent increase when comparing the first six-month period to the last six-month period).
RkJQdWJsaXNoZXIy OTkwMTQ4