Analysis

Four dissenting Justices sarcastically suggested Tuesday that the Supreme Court had issued a decision that “aids no one, now or ever” and should simply be forgotten, but the majority did give employers a plan that worked this time to “pick off” the lead worker among a group whose pay has been docked in a way that may be illegal.  And that plan might work again.

The Court reached that result in Genesis HealthCare Corp. v. Symczyk (11-1059) by declining to decide the issue that had been granted review, and moving on to wipe out any remaining claim that the first worker had for herself and for her co-workers in what is called a “collective action” under federal wage-and-hour law.   The decision, with the majority opinion written by Justice Clarence Thomas, split the Court five to four.

The Thomas opinion, although quite complex in its reasoning, in general showed again the impatience of the current Court majority with lawsuits based upon common claims of a group.   The Court has issued a string of decisions narrowing the option of bringing “class action” lawsuits — including one recently that also involved reaching out to decide an issue that had not been put in issue.  The Genesis HealthCare ruling extended the string to include employee group claims for pay under the Fair Labor Standards Act.

The tartly worded dissent written by Justice Elena Kagan went to unusual lengths to dismiss the decision as meaningless, suggesting that readers should “feel free to relegate the majority’s decision to the furthest reaches of your mind: The situation it addresses should never again arise.”

That assessment, though, was immediately contradicted by an employer advocacy group, the National Federation of Independent Business, which had filed an amicus brief in the case.  The NFIB said in a statement that the decision “has significant implications for small-business owners, who are disproportionately impacted by costly wage and hour lawsuits….The ruling today is a victory for small businesses because it will make it easier to stop frivolous lawsuits before they become multi-million-dollar affairs.”

Under the Fair Labor Standards Act, employers are required to pay overtime if a worker is on the job more than forty hours in a workweek, and thus a worker has a right to full pay for forty hours of work in a given week.  In the Genesis HealthCare case, a nurse at its nursing home in Philadelphia, Laura Symczyk, complained that the employer regularly deducted thirty minutes of pay per shift from each worker, for meal-time breaks, whether or not a worker took a full, uninterrupted break.

The Act allows a worker with a complaint like that to sue, not only for herself, but for her co-workers who were treated the same way, in what is called a “collective action” — rather like a class action, but with some differences.

Symczyk filed such a lawsuit, but her employer responded to the lawsuit by offering her $7,500 in unpaid wages, plus attorneys’ fees, costs and expenses.  The company put a time limit for her to accept.  She did not respond, so the employer asked the federal court to dismiss the lawsuit, arguing that, under federal court rules, she had a chance at everything she sought, so she had no continuing interest in the litigation.

Symczyk’s lawyers countered that the company was trying to pick her off, in order to scuttle the collective claim she was asserting for her co-workers.   The federal judge, finding that no other workers had joined in the claim and that Symczyk’s personal claim had been fully satisfied, dismissed the case altogether.   The Third Circuit Court partly agreed, finding Symczyk’s personal claim to be moot, but giving her another chance to revive her collective claim in the District Court.   It essentially accepted Symczyk’s argument that Genesis HealthCare was trying to “pick off” its employees to end their group claim.   If other workers now joined in, the Circuit Court said, the collective claim could go ahead.   Genesis HealthCare took the case on to the Supreme Court.

The Court overturned that result by the closest possible division.  While the Thomas opinion for the majority insisted that the Court had answered the question raised by Symczyk — whether her claim was moot so the lawsuit could not go ahead — it said it was not actually settling the mootness issue, but only assuming the case to be moot.

Conceding that the federal appeals courts are split on whether an offer of settlement of a federal lawsuit is enough to make it moot, the majority said it would not resolve that dispute because the mootness issue “is not properly before us.”  The Third Circuit ruled the case moot, and Symczyk had not filed her own appeal to the Supreme Court, so the Justices were barred, Thomas wrote, from questioning the Third Circuit on that point.  Moreover, Thomas said, Symczyk had waived the mootness issue in the district court, in the Third Circuit, and in her reply to Genesis HealthCare’s appeal to the Supreme Court.

Moving on from that point, the majority found that Symczyk has no remaining “personal interest” in representing the other workers who had failed to join in her lawsuit, and she had no other “continuing interest that would preserve her suit.”

Along the way toward that result, the Thomas opinion concluded that the kind of “collective action” that Symczyk had tried to pursue cannot continue “once the individual claim is satisfied.”  Unless other workers had actually come forward to take part, the decision said, nothing survived the settlement offer the employer made to her and she passed it up.

That, in essence, sketched out a practical approach for employers faced with a single worker seeking to file a pay claim in the form of a collective action.  The complaining worker could be offered the pay she was asking, given a deadline, and if the deadline passes, go to court to get the case dismissed before any other workers join in, and the case is over.

The mootness issue is the main one that sent four of the Justices into dissent.   They argued that a mere offer to pay off a litigant, when that offer simply went unaccepted, is not enough to end a lawsuit.   Since the majority proceeded on the false assumption that that satisfied the federal court rule governing such payment offers, the remainder of the Court majority’s analysis was beside the point, and the situation would not recur in any other case, the dissenting opinion asserted.

Joining in the Thomas opinion were Chief Justice John G. Roberts, Jr., and Justices Samuel A. Alito, Jr., Anthony M. Kennedy, and Antonin Scalia.  Kagan’s dissent was joined by Justices Stephen G. Breyer, Ruth Bader Ginsburg, and Sonia Sotomayor.

 

Posted in Genesis HealthCare Corp. v. Symczyk, Featured, Merits Cases

Recommended Citation: Lyle Denniston, Opinion recap: A “pick off” strategy works, SCOTUSblog (Apr. 16, 2013, 1:41 PM), http://www.scotusblog.com/2013/04/opinion-recap-a-pick-off-strategy-works/