Adams-Gillard v. Sedgwick Claims Mgmt. Servs.

1

DENITA ADAMS-GILLARD, KATHRYN HAMANN, AND JAY SYCKS, individually and on behalf of all others similarly situated, Plaintiffs, v. SEDGWICK CLAIMS MANAGEMENT SERVICES, INC., a Tennessee for Profit Corporation, Defendant.

No. 2:21-cv-02038-SHM-cgc

United States District Court, W.D. Tennessee, Western Division

March 30, 2022

JURY DEMAND

ORDER DENYING INTERVENTION

SAMUEL H. MAYS, JR. UNITED STATES DISTRICT JUDGE

This is a putative class action. Named Plaintiffs Denita Adams-Gillard (“Adams-Gillard”) and Jay Sycks (“Sycks”) assert claims for unpaid overtime against their employer, Defendant Sedgwick Claims Management Services, Inc. (“Sedgwick”).^[1]Shondra Siler (“Siler”), another Sedgwick employee, filed an initial motion to intervene on November 26, 2021. (D.E. 62.) (“Initial Motion to Intervene”). Siler filed a corrected motion to intervene on November 29, 2021. (D.E 66.) (“Corrected Motion to Intervene”). Named Plaintiffs and Sedgwick filed responses in opposition. (D.E. 67; 81; 82.) Siler filed a reply. (D.E. 85.) The Initial Motion to Intervene and the Corrected Motion to Intervene are DENIED.

I. Background

The Motions to Intervene address the unpaid overtime claims of certain Sedgwick Disability Representative Senior (“DRS”) employees based in Illinois. Siler, Named Plaintiffs, and Sedgwick dispute how and where those claims should be resolved. There are three relevant cases: 1) Easterwood v. Sedgwick Claims Management Services, Inc., 6:19-cv-700-Orl-78LRH (M.D. Fla.) (“Easterwood Action”); 2) Walker v. Sedgwick Claims Management Services, Inc., 1:19-cv-07482 (N.D.Ill.) (“Walker Action”); and 3) Adams-Gillard v. Sedgwick Claims Management Services, Inc., 2:21-cv-02038-SHM-cgc (W.D. Tenn.) (“Adams-Gillard Action”), the present case.

In the Easterwood Action, Sedgwick employees asserted unpaid overtime claims under the Fair Labor Standards Act (“FLSA”), 29 U.S.C. §§ 201, et seq. The court in the Easterwood Action certified an opt-in collective that covered Sedgwick DRS employees whose job was to process disability claims (“DRS-Disability Employees”). (Easterwood, D.E. 128.) Of approximately 137 Illinois DRS-Disability Employees, 20 exercised their opt-in right and resolved their FLSA claims. (See Adams-Gillard, D.E. 70, PAGEID 396.) Adams-Gillard was among the Illinois DRS-Disability Employees who opted in to the FLSA collective. (See Easterwood, D.E. 193.)

In the Walker Action, Sedgwick employees asserted unpaid overtime claims under the FLSA, the Illinois Minimum Wage Law, 80 ILCS §§ 105/1, et seq., and the Chicago Minimum Wage Ordinance, § 1-24-10 of the Municipal Code of Chicago. (Walker, D.E. 1.) An initial complaint was filed on November 12, 2019. (Walker, D.E. 1.) The initial complaint names Janet Walker (“Walker”) and Kimberly Harris (“Harris”) as representative plaintiffs. Walker and Harris sought to represent approximately 40 Sedgwick DRS employees whose job was to process ADA accommodation requests at Sedgwick's Chicago locations (“DRS-Accommodation Employees”). (Adams-Gillard, D.E. 70, PAGEID 396-97). An amended complaint was filed on April 19, 2021. (Walker, D.E. 38.) It added Siler as a representative plaintiff. Walker, Harris, and Siler seek to represent both the 40 Illinois DRS-Accommodation Employees and the 117 Illinois DRS-Disability Employees who did not opt in to the Easterwood Action. (Adams-Gillard, D.E. 70, PAGEID 396-97.)^[2] In the Adams-Gillard Action, Sedgwick employees asserted unpaid overtime claims under Illinois state law and Chicago Municipal Ordinances and Codes. (Adams-Gillard, D.E. 7, PAGEID 30.) The complaint was filed on January 19, 2021. (Adams-Gillard, D.E. 7.) Adams-Gillard, as a Named Plaintiff, seeks to represent a class of Illinois DRS-Disability Employees. (Adams-Gillard, D.E. 7, PAGEID 30.)

Sedgwick moved to dismiss the complaint in the Adams-Gillard Action. (Adams-Gillard, D.E. 27). Sedgwick argued that the claims in the Walker Action and Adams-Gillard Action were “nearly identical” and that the Court should stay or dismiss the Adams-Gillard Action under the first-to-file rule. (Adams-Gillard, D.E. 27-1, PAGEID 123.) Named Plaintiffs responded in opposition. (Adams-Gillard D.E. 35, PAGEID 201.) Sedgwick withdrew its first-to-file argument on June 30, 2021. (Adams-Gillard, D.E. 40.)

On October 22, 2021, Named Plaintiffs advised the Court that the parties to the Adams-Gillard Action had reached a settlement that resolved the state and municipal overtime claims of Illinois DRS-Disability Employees. (Adams-Gillard, D.E. 55.) Sedgwick informed Siler and the court in the Walker Action that it could no longer participate in settlement discussions about Illinois DRS-Disability employees. (Adams-Gillard, D.E. 81, PAGEID 520.) Named Plaintiffs filed a motion for settlement approval and class certification on December 16, 2021. (Adams-Gillard, D.E. 80.)

II. Jurisdiction

A federal district court has original jurisdiction of all civil actions between citizens of different states “where the matter in controversy exceeds the sum or value of $75, 000, exclusive of interest and costs.” 28 U.S.C. § 1332(a)(1). To determine the amount in controversy, a court “consider[s] the amount alleged in the complaint and do[es] not dismiss a complaint for lack of subject matter jurisdiction unless it appears to a legal certainty that the plaintiff in good faith cannot claim the jurisdictional amount.” Charvat v. NMP, LLC, 656 F.3d 440, 447 (6th Cir. 2011). In any civil action of which a federal district court has original jurisdiction, it may exercise supplemental jurisdiction over other related claims that form part of the same case or controversy, subject to certain limitations. 28 U.S.C. § 1367.

Sedgwick is incorporated and headquartered in Tennessee. (Adams-Gillard, D.E. 7 at ¶ 2.) Adams-Gillard is a citizen of Indiana. (Adams-Gillard, D.E. 7 at ¶ 3.) Sycks is a citizen of Ohio. (Adams-Gillard, D.E. 7 at ¶ 4.) The complaint alleges that the amount in controversy exceeds $75, 000. (Adams-Gillard, D.E. 7 at ¶ 3.) There is no legal certainty that prevents each Named Plaintiff from claiming that amount in good faith. The Court has diversity jurisdiction under 28 U.S.C. § 1332(a). The claims of Named Plaintiffs and putative class members are so related as to form the same case or controversy. To the extent that putative class members do not meet the requirements of 28 U.S.C. § 1331(a), the Court exercises supplemental jurisdiction over their claims under 28 U.S.C. § 1367.

III. Standard of Review

Under some circumstances, the Court must allow any person to intervene in a case as a matter of right; under others, the Court may allow permissive intervention. Fed.R.Civ.P. 24(a)- (b). “[Rule] 24 distinguishes a permissive intervenor from an intervenor of right by the stake each has in the litigation. The intervenor of right has an interest in the litigation that it cannot fully protect without joining the litigation, while the permissive intervenor does not.” Stringfellow v. Concerned Neighbors in Action, 480 U.S. 370, 381 (1987) (Brennan, J., concurring in part and concurring in the judgment). “Rule 24 should be ‘broadly construed in favor of potential intervenors.'” Stupak-Thrall v. Glickman, 226 F.3d 467, 472 (6th Cir. 2000) (quoting Purnell v. Akron, 925 F.2d 941, 950 (6th Cir. 1991)). That “does not mean that Rule 24 poses no barrier to intervention at all.” Id. “[A] district court is required to accept as true the nonconclusory allegations made in support of an intervention motion.” Parkwest Dev., LLC v. Ellahi, 2018 WL 3640433, at *2 (E.D. Mich. Aug. 1, 2018) (citing Sw. Ctr. for Biological Diversity v. Berg, 268 F.3d 810, 819 (9th Cir. 2001)).

Mandatory intervention requires putative intervenors to establish: “(1) timeliness of the application to intervene, (2) the applicant's substantial legal interest in the case, (3) impairment of the applicant's ability to protect that interest in the absence of intervention, and (4) inadequate representation of that interest by parties already before the court.” Stupak-Thrall, 226 F.3d at 471 (citing Mich. State AFL- CIO v. Miller, 103 F.3d 1240, 1245 (6th Cir. 1997), and Grutter v. Bollinger, 188 F.3d 394, 397-98 (6th Cir. 1999)). A motion for mandatory intervention must be denied if the proposed intervenor cannot satisfy all of the criteria. United States v. Michigan, 424 F.3d 438, 443 (6th Cir. 2005) (citing Grubbs v. Norris, 870 F.2d 343, 345 (6th Cir. 1989)).

“To intervene permissively, a proposed intervenor must establish that the motion for intervention is timely and alleges at least one common question of law or fact.” Michigan, 424 F.3d at 445 (citing Mich. State AFL-CIO, 103 F.3d at 1248). “Once [the timeliness and common question of law or fact elements] are established, the district court must then balance undue delay and prejudice to the original parties, if any, and any other relevant factors to determine whether, in the court's discretion, intervention should be allowed.” Id. (citing Mich. State AFL-CIO, 103 F.3d at 1248). “[T]he decision whether to grant permissive intervention resides largely in the discretion of the district court.” Stringfellow, 480 U.S. at 382 n.1.

IV. Analysis

A. Mandatory Intervention

Siler has not established that she is entitled to intervention as of right.

1. Timeliness of the Intervention

When considering a motion to intervene, “the court where the action is pending must first be satisfied as to timeliness.” Nat'l Ass'n for the Advancement of Colored People v. New York, 413 U.S. 345 365 (1973); see also Blount-Hill v. Zelman, 636 F.3d 278, 284 (6th Cir. 2011); United States v. Ritchie Special Credit Invs., Ltd., 620 F.3d 824, 832 (8th Cir. 2010) (“The issue of the timeliness of a motion to...