16 Litigating CA Wage & Hour Class and PAGA Actions (23rd Edition) Seyfarth Shaw LLP | www.seyfarth.com Most notably, in a case in which Seyfarth Shaw represented the prevailing defendant, the Ninth Circuit, in Vinole v. Countrywide Home Loans, Inc.,72 affirmed a district court order that the outside sales exempt status of branch loan originators could not be litigated on a collective basis. There was no evidence that Countrywide required its employees to spend a certain amount of time inside, and there was great variation in the testimony as to how different loan originators actually spent their time. The Ninth Circuit explained how this made class certification inappropriate: Plaintiffs seek to minimize the district court’s main concern–that although there are common issues, including uniform classification, the inquiry into each HLC’s exempt status would burden the court.73 The principal factor in determining whether common issues of fact predominate is whether the uniform classification, right or wrong, eases the burden of the individual inquiry. But this is a legitimate concern. Plaintiffs’ claims will require inquiries into how much time each individual HLC spent in or out of the office and how the HLC performed his or her job; all of this where the HLC was granted almost unfettered autonomy to do his or her job. This must be considered along with the lack of issues subject to common proof that would actually ameliorate the need to hold several hundred mini-trials with respect to each HLC’s actual work performance.74 Likewise, Duran v. U.S. Bank,75 a key wage and hour class certification decision, discussed in Section XVI.G, infra, involved the outside sales exemption. In Duran, the California Supreme Court found that the evidence established wide variation from salesperson to salesperson in terms of the amount of time spent on outside sales activities. The trial court’s “decision to extrapolate classwide liability from a small sample, and its refusal to permit any inquiries or evidence about the work habits of [salespersons] outside the sample group, deprived USB of the ability to litigate its exemption defense, and therefore violated the employer’s due process rights to present a full defense.”76 E. The Commissioned Salesperson Exemption The Commissioned Salesperson Exemption applies to “Retail Industry” employees (IWC Wage Order 7) and employees in “Professional, Technical or Clerical Occupations” not covered by a different Wage Order (Wage Order 4). Under California law, a commissioned salesperson covered by either Wage Order 4 or Wage Order 7 is exempt from overtime compensation if: 72 571 F.3d 935 (9th Cir. 2009). 73 Id. at 946. 74 Id. at 947 (emphasis added); see also Mevorah v. Wells Fargo Home Mortgage, Inc., 268 F.R.D. 604 (N.D. Cal. Jan. 12, 2010) (on remand after reversal of certification decision for reconsideration, district court denied certification as to class of Wells Fargo home loan consultants); Maddock v. KB Homes, Inc., 248 F.R.D. 229 (C.D. Cal. 2007) (denying class certification as to putative class of commissioned home salespersons). 75 59 Cal. 4th 1 (2014). 76 Id. at 35.
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