Ealy-Simon v. Change Healthcare Operations, LLC, 3:20-cv-00521

CATHERINE EALY-SIMON and KRISTIN WILSON,individually and on behalf of all other similarly situated individuals, Plaintiffs, v. CHANGE HEALTHCARE OPERATIONS, LLC, Defendant.

NO. 3:20-cv-00521

UNITED STATES DISTRICT COURT FOR THE MIDDLE DISTRICT OF TENNESSEE NASHVILLE DIVISION

January 22, 2021

JUDGE RICHARDSON

MEMORANDUM OPINION

Pending before the Court is Plaintiffs' Motion for Conditional Certification of this case as a Collective Action. (Doc. No. 23, "Motion"). Defendant responded in opposition (Doc. No. 28), and Plaintiffs replied (Doc. No. 32). The Motion is ripe for review.

For the reasons discussed below, Plaintiffs' Motion (Doc. No. 37) will be granted in part.

BACKGROUND¹

Plaintiffs Catherine Ealy-Simon and Kristin Wilson ("Plaintiff Ealy-Simon" and "Plaintiff Wilson," collectively "Plaintiffs") brought this action individually and on behalf of all others similarly situated pursuant to the Fair Labor Standards Act ("FLSA"), 29 U.S.C. § 201 et seq. (Doc. No. 1 at ¶ 1).

Defendant provides call center services and operates an outsourced call center for large physician groups, hospitals, and health systems. (Id. at ¶ 2). Defendant employs hourly call center employees, known as Patient Service Representatives ("PSRs"),² in multiple call center facilities throughout the United States, including in Port St. Lucie, Florida. (Id. at ¶¶ 3, 4). Aerotek, a nonparty which provides recruiting and staffing services, hired and employed Plaintiff Ealy-Simon and assigned her to work as a PSR at Defendant's call center in Port St. Lucie. (Id. at ¶ 6). Defendant hired and directly employed Plaintiff Wilson as a PSR at the facility in Port St. Lucie. (Id.). Defendant requires its PSRs to work a full schedule and overtime, but it does not compensate them for all hours worked. (Id. at ¶ 10).

PSRs are required to perform compensable work tasks before and after their shifts and during meal periods inasmuch as they are required to turn on their computers, launch the computer networks, software programs, applications and phone systems required to take calls. (Id.). The pre-shift startup and log-in process typically takes 10-20 minutes. (Id. at ¶ 81). PSRs have one unpaid 30-minute meal period each shift, but PSRs must end their meal period early in order to unlock their computers and log in to the needed programs, which takes around 5-10 minutes. (Id. at ¶¶ 88, 91). After the end of a shift, logging out and shutting down a computer takes approximately 5 minutes. (Id. at ¶ 94). Despite these log-in and log-out procedures, PSRs are paid only for the time they are connected to Defendant's phone system and are available to make and take phone calls. (Id. at ¶ 10).

The Complaint asserts three counts: (1) a collective action for violation of the FLSA for failure to pay overtime wages, (2) a nationwide class action for breach of contract under Fed. R. Civ. P. 23, and (3) a nationwide class action for unjust enrichment under Fed. R. Civ. P. 23.

The Motion relates to the first Count only. Via the Motion, Plaintiffs seek to conditionally certify a class of allegedly similarly situated workers allegedly denied unpaid overtime wages under the FLSA. (Doc. No. 23 at 9). In support of the Motion, Plaintiffs filed declarations from each of the two Plaintiffs and two proposed putative opt-in Plaintiffs. Plaintiffs ask the Court (1) to conditionally certify this case as a FLSA collective action under 29 U.S.C. § 216(b) on behalf of similarly situated employees; (2) to require Defendant to identify all putative FLSA Collective members by providing a list of names and contact information within ten days of the Court's decision; (3) to permit Plaintiffs' Counsel to send notice via mail, email, and text message, and (4) to approve a 60-day opt-in period from the date notice is sent, with a reminder postcard and email sent 30 days into the notice period to those who have not opted in. (Doc. No. 23 at 1).

In support of its opposition, Defendant filed several declarations. (Doc. Nos. 29, 30, 31).

LEGAL STANDARD

A. Conditional Certification

The FLSA provides that a collective action may be maintained against any employer by one or more employees for and on behalf of themselves and other employees similarly situated. 29 U.S.C. § 216(b). Because the FLSA requires only that employees be similarly situated, plaintiffs seeking to certify a collective action under the FLSA face a lower burden than those seeking to certify a class action under Federal Rule of Civil Procedure 23. O'Brien v. Ed Donnelly Enters., 575 F.3d 567, 584 (6th Cir. 2009), abrogated on other grounds by Campbell-Ewald Co. v. Gomez, 136 S. Ct. 663 (2016). Also, unlike class actions under Federal Rule of Civil Procedure 23, FLSA collective actions require similarly situated employees to "opt-in" as plaintiffs. 29 U.S.C. § 216(b).

Typically, courts employ a two-phase inquiry to address whether the named plaintiffs are similarly situated to the employees they seek to represent. White v. Baptist Mem'l Health Care Corp., 699 F.3d 869, 877 (6th Cir. 2012); Comer v. Wal-Mart Stores, Inc., 454 F.3d 544, 546 (6th Cir. 2006). "The first [phase] takes place at the beginning of discovery. The second occurs after all of the opt-in forms have been received and discovery has concluded." Id. at 546 (internal quotation marks omitted).

At the first stage, the plaintiff bears the burden of showing that employees in the class are similarly situated. Benson v. Asurion Corp., Case No. 3:10-cv-526, 2010 WL 4922704, at *2 (M.D. Tenn. Nov. 29, 2010). Conditional certification requires only a modest factual showing, and district courts should use a fairly lenient standard that typically results in certification. Comer, 454 F.3d at 547. At the first stage, the court does not resolve factual disputes, decide substantive issues related to the merits of the case, or make credibility determinations. Roberts v. Corr. Corp. of Am., Case No. 3:14-cv-2009, 2015 WL 3905088, at *10 (M.D. Tenn. June 25, 2015).

Although the required factual showing is "modest," it cannot be satisfied simply by unsupported assertions. Medley v. Southern Health Partners, Inc., Case No. 1:17-cv-00003, 2017 WL 3485641, at * 5 (M.D. Tenn. Aug. 15, 2017). In other words, conclusory allegations are insufficient to support conditional certification. Arrington v. Michigan Bell Tel. Co., No. 10-10975, 2011 WL 3319691, at * 4 (E.D. Mich. Aug. 1, 2011) (citing 7B Wright, Miller & Kane, Federal Practice & Procedure § 1807 (3d ed. 2005) at 490-91). This is true even if the conclusory allegations are asserted not merely in a complaint, but rather in a (sworn) plaintiff's declaration. See McKinstry v. Dev. Essential Servs., Inc., No. 2:16-cv-12565, 2017 WL 815666, at * 2 (E.D. Mich. Mar. 2, 2017) (noting that Arrington's rule applies even to assertions made in a declaration). The named plaintiff must present some factual support for the existence of a class-wide policy or practice that violates the FLSA. Medley, 2017 WL 3485641, at *5. A plaintiff must submit evidence establishing at least a colorable basis for her claim that a class of similarly situated plaintiffs exists. Id.; Swinney v. Amcomm Telecom., Inc., No. 12-12925, 2013 WL 28063, at *5 (E.D. Mich. Jan. 2, 2013). At the first stage, a plaintiff must present substantial allegations supported by declarations; if the plaintiff meets that burden, a court, in its discretion, may conditionally certify the case as a collective action. Medley, 2017 WL 3485641, at *5.

"[T]he certification is conditional and by no means final." Comer, 454 F.3d at 546. After discovery, the defendant may move for decertification of the conditional class, which triggers the second phase of the court's review. See O'Brien, 575 F.3d at 583. At this second stage, the court has access to more information and employs a "stricter standard" in deciding whether class members are, in fact, similarly situated. Comer, 454 F.3d at 547.

B. Similarly Situated

Although the FLSA does not define the term "similarly situated," the Sixth Circuit has held that "plaintiffs are similarly situated when they suffer from a single, FLSA-violating policy, and when proof of that policy or of conduct in conformity with that policy proves a violation as to all the plaintiffs." O'Brien, 575 F.3d at 585. Employees also may be similarly situated if their claims are merely "unified by common theories of defendants' statutory violations, even if the proofs of these theories are inevitably individualized and distinct." Id. Indeed, "[s]howing a 'unified policy' of violations is not required." Id. at 584.

As noted above, to obtain conditional certification, a plaintiff must submit evidence establishing at least a colorable basis for her claim that a class of similarly situated plaintiffs exist. Swinney, 2013 WL 28063, at * 5; O'Neal v. Emery Fed. Credit Union, No. 1:13-cv-22, 2013 WL 4013167, at * 5 (S.D. Ohio Aug. 6, 2013). Certification at the first (or "notice") stage, although governed by a lenient standard, is not automatic. Harriel v. Wal-Mart Stores, Inc., Civil Action No. 11-2510, 2012 WL 2878078, at *4 (D.N.J. July 13, 2012). "A plaintiff must show a 'factual nexus' between his or her situation and the situation of other current and former employees sufficient to determine that they are similarly situated." Id.

ANALYSIS

I. Motion for Conditional Certification

The Motion involves the first (notice) stage and seeks only conditional, not final, certification. The proposed class (which is sometimes referred to as a "collective" in situations involving a collective action under the FLSA rather than a class action under Federal Rule of Civil Procedure 23) comprises:

All similarly situated current and former Patient Service Representatives and similar job titles who work or have worked for Change Healthcare Operations, LLC ("Defendant") at any of its call center facilities at any time during the three years preceding the filing of the Complaint through judgment.

(...