Free Response to Motion - District Court of Colorado - Colorado

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UNITED STATES DISTRICT COURT DISTRICT OF COLORADO CASE NO. 03-cv-02485 MSK-PAC Camille Melonakis-Kurz, individually and on behalf of other similarly situated employees, Plaintiffs, v. Heartland Home Finance, Inc., Defendant. PLAINTIFFS' MEMORANDUM IN OPPOSITION TO DEFENDANT'S MOTION FOR DECERTIFICATION ________________________________________________________________________ I. INTRODUCTION

957 loan officers from 67 branch offices in 31 states have joined this overtime case by filing consent forms with this Court (collectively referred to as "Plaintiffs").1 They joined this case because of Defendant Heartland Home Finance's ("Defendant") past and present policy of never paying any loan officer overtime compensation at any time.2 Defendant is claiming this case should be decertified primarily for two reasons: (1) the applicability of the administrative exemption; and (2) an alleged nationwide policy of compliance with the FLSA. First and foremost, after this Court's ruling on Plaintiffs' Motion for Summary Judgment, Plaintiffs believe the only issue remaining

Fisher Aff. at ¶ 2. Defendant also has a practice of failing to pay minimum wage. Most Plaintiffs are also involved in another lawsuit seeking recovery of minimum wage in the Northern District of Georgia federal court. Scott et al v. Heartland Home Finance, Inc., Civil Action No. 05-2812 TWT. Plaintiffs' Motion for Conditional Certification is currently pending before that Court. See McClain v. Heartland Home Finance, Inc. Civ. Action No. 05-0416 TWT.
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will be that of damages. Defendant does not dispute liability for the timeframes of preJuly 31, 2002 and post-August 22, 2004. With respect to the timeframe of July 31, 2002 to August 22, 2004, as explained in Plaintiffs' Motion for Summary Judgment, Defendant cannot prove that Plaintiffs are subject to the administrative exemption. With respect to Defendant's position that this case should be decertified because Defendant allegedly does not have a policy of non-compliance with the FLSA, this argument must be rejected. Unlike "off the clock" cases where some loan officers were paid overtime and others were not due to "rogue" managers, Defendant has admitted to a nationwide corporate policy of never paying any loan officers any overtime compensation at any time, regardless of whether their timesheets submitted to corporate reflected overtime or not. Because the overwhelming evidence demonstrates that Plaintiffs are similarly situated, because it is undisputed that Defendant had a nationwide policy of never paying overtime to any loan officer at any time, and because fairness and procedural considerations justify a collective proceeding, Defendant's motion to decertify this collective action must be denied. II. A. FACTS AND ANALYSIS FOR DECERTIFICATION Burden of Proof and Elements for Decertification.

Plaintiffs agree with Defendant's recitation of the burden of proof and elements relating to decertification. B. The Factual and Employment Setting of Plaintiffs. 1. Plaintiffs perform their duties under the same hierarchy.

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Defendant employs approximately 300 loan officers who sell loans at branch locations throughout the United States.3 Defendant maintains two corporate offices.4 The sales operation is headquartered in Cleveland, Ohio, and the administrative headquarters is located in Downers Grove, Illinois.5 All loan officers work within the "sales" operation.6 Within the sales operation, the loan officers are all subject to the same hierarchy. They report to their individual branch sales manager, who reports to one of Defendant's seven regional managers, who report to Defendant's director of sales, who in turn reports directly to its owner, Donald Flynn ("Flynn").7 The human resources, legal, and payroll functions used by all loan officers are located at the corporate level and not at the individual branch offices.8 2. Plaintiffs are all loan officers who perform similar job duties.

Plaintiffs believe that job duties will not be an issue after the Court's ruling on Plaintiffs' Motion for Summary Judgment. For the timeframe prior to July 31, 2002 and the timeframe after August 22, 2004, Defendant concedes that it does not meet the salary basis test.9 Therefore, an analysis of job duties is unnecessary, as the administrative exemption cannot apply. With respect to the timeframe of July 31, 2002 to August 22, 2004, Defendant cannot as a matter of law meet the "long test" administrative exemption standards necessary to qualify for the exemption. Regardless, even if the administrative exemption survived summary judgment, the vast similarities in job duties performed by Plaintiffs preclude decertification.
3 4

Ex. 1 at 14; Ex. 5 at 15. Ex. 1 at 13, 27. 5 Id. at 13-14, 27. 6 Id. at 14-15, 20, 21. 7 Id. at 12-13 8 Id. at 34-35. 9 See Defendant's Response in Opposition to Plaintiffs' Amended Motion for Summary Judgment at p. 2 (Dkt. 345).

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Defendant argues that this action must be decertified because of the individualized factual inquiry into Plaintiffs' day to day activities. However, courts have held decertification to be inappropriate even when examination of the plaintiffs' job duties was required. See e.g., Scott v. Aetna Servs., Inc., 210 F.R.D. 261, 265 (D. Conn. 2002)(noting that "courts have held that it is appropriate to bring an FLSA exemption claim as a class action notwithstanding the highly fact-specific nature of the exemption inquiry"); Bradford v. Bed Bath & Beyond, 184 F. Supp. 2d 1342, 1346-1352 (N.D. Ga. 2002)(reviewing the representative opt-in Plaintiffs' depositions and focusing on whether the job duties of the deponents were substantially similar in denying decertification). For purposes of decertification, the Court does not determine whether Plaintiffs should be classified as exempt or non-exempt employees. See Thiessen, 267 F.3d at 1106-07; Bradford, 184 F. Supp. 2d at 1345. Rather, the only issue before the Court on the present motion is whether Plaintiffs' job duties were similar. See Bradford, 184 F. Supp. 2d at 1345 (emphasis added). Similarly situated does not mean identically situated. See id. at 1347; Moss v. Crawford & Co., 201 F.R.D. 398, 409 (W.D. Pa. 2000)(holding that differences between job duties, geographic assignments and hourly billing rates did not warrant decertification). In this case, Plaintiffs have presented substantial evidence that their job duties are similar. All loan officers are required to sign the same employment agreement.10 That employment agreement sets forth their job description and compensation.11 Defendant's branch sales managers are not allowed to make changes to that agreement.12 According to

10 11

Ex. 1 at 66. See e.g. Ex. 10. 12 Ex. 1 at 66.

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Flynn, this job description applies to all loan officers nationwide.13 He testified that it accurately describes the duties performed by all loan officers.14 That job description requires loan officers to sell loans for Defendant under its strict policies and procedures: The Employee agrees to actively engage in the origination and sale of mortgage loans15 to the general public and to assist in the processing of each loan application he originates. The Employee agrees to refer mortgage applications exclusively to the Company and not into enter (sic) any such agreement with any other mortgage broker during the term of this agreement. The Employee further agrees to maintain current records of all applications in compliance with Real Estate Settlement Procedures Act ("RESPA') and R.C.O., to maintain loan files in compliance with policies and procedures set forth by the Company (all forms to be completed and in stacking order, approval or denial letters sent, etc.), to follow all policies and procedures set forth by the Company, and not make any representations or commitments on behalf of the Company, and at all times, to uphold the good name and reputation of the Company.16 Plaintiffs' day to day job duties are indisputably as follows: a) The loan officer telemarkets potential customers ("leads") who appear on lead sheets provided by Defendant;17 The loan officer asks the potential customer standardized questions to complete a 1003 credit application for a mortgage;18

b)

13 14

Id. at 36-37, 64. Id. at 36-37. 15 Flynn testified that loan officers are responsible for "selling to those leads." Id. at 38. 16 Id. at 36; Ex. 10 (emphasis added). 17 Defendant's testimony and documents: Ex. 1 at 38-40; Ex. 14 at ¶ 1. Plaintiffs' testimony at Ex. 23: Acceta at 8; Agostini at 24; Alawan at 10; Artis at 147-149; Berman at 15; Bias at 19; Clark at 82-83; Cousino at 16-17; Dary at 11; DiBlasi at 8, 51, 85; Dinkel at 60; Donahoo at 34-35; Fleck at 54, 56; Gaddis at 19; Gleason at 52; Gunn at 13-14; Hines at 15-16; Horton at 14-15, 17; Johnson at 10-11, 14-15; Kirkland at 12, 49, 140; Lambros at 24, 26-27; Legree at 16; Liphard at 29-30; Lutke at 21; MelonakisKurz at 8, 47-48, 67-69; Miles at 15; Provost at 25-26, 32; Reynolds at 82; Roberts at 177; Roddy at 15-16; Rodriguez at 16; Rohrer at 26-27; Sandifer at 19-20, on 11/08/2005 and at 66 on 11/10/2005; Schwiderson at 9-10; Sweet at 34-35; Thomas at 36, 55; Williams at 19, 50; Ziemack at 13. 18 Defendant's testimony and documents: Ex. 1 at 44, 53; Ex. 14 at ¶ 2. Plaintiffs' testimony at Ex. 23: Acceta at 16-17, 95; Agostini at 25; Alawan at 10; Artis at 91-92; Berman at 16; Bias at 20-21; Clark at 8283; Cousino at 17; Dary at 11-12; DiBlasi at 11-12; Dinkel at 31; Donahoo at 34-35, 40, 102; Fleck at 54, 58; Gaddis at 32, 74; Gleason at 66, 79-80; Gunn at 14-15; Hines at 21; Horton at 15, 22-23, 98; Johnson at 11; Lambros at 24-25; Legree at 17-18; Liphard at 31; Luttke at 21-22; Melonakis-Kurz at 11, 45, 47-48; Miles at 15-16; Provost at 27; Reynolds at 83; Roberts at 26, 162; Roddy at 15-16; Rodriguez at 55-56; Rohrer at 46-47; Sandifer at 22 on 11/08/2005 and at 67 on 11/10/2005; Schwiderson at 22; Sweet at 34-36, 40, 83; Thomas at 37; Williams at 51-52, 58; Ziemack at 13-14.

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c)

Defendant's computer system generates the customer's credit score;19 The loan officer discusses with the customer their loan needs in order to sell them a loan product;20 The loan officer asks the customer for standardized documents;21 The loan officer contacts an appraiser in the area to obtain an appraisal of the property;22 The loan package is then sent to the loan processor and then to an underwriter23 for final approval, approval with modifications, or denial of the loan;24 and

d)

e) f)

g)

Defendant's testimony and documents: Ex. 1 at 45-46; Ex. 14 at ¶ 3. Plaintiffs' testimony at Ex. 23: Accetta at 13; Agostini 120-21; Alawan at 28-29; Artis at 92, 97; Berman at 16-17; Clark at 82-83; Dary at 12; DiBlasi at 11, 24; Dinkel at 31; Donahoo at 36; Fleck at 54, 58; Gaddis at 19; Gleason at 52; Gunn at 15, 57-59; Hines at 20-21; Johnson at 11; Kirkland at 62, 64; Lambros at 24; Legree at 17; Liphard at 31; Melonakis-Kurz at 48-49; Reynolds at 83; Roberts at 26-27; Roddy at 16; Rodriguez at 55; Rohrer at 46; Sandifer at 25 on 11/08/2005; Schwiderson at 22; Sweet at 35-36; Thomas at 37; Williams at 51-52; 59; Ziemack at 14. 20 Defendant's testimony and documents: Ex. 1 at 38, 40, Ex. 14 at ¶ 2. Plaintiffs' testimony at Ex. 23: Accetta at 10-11; Agostini at 27-28; Alawan at 11; Artis at 91-92; Berman at 17; Bias at 20, 22, 26, 31-32; Clark at 82-88; Cousino at 16-17, 20; Dary at 11, 70-71; DiBlasi at 10-11; Dinkel at 31-33, 59, 61-62; Donahoo at 36-38, 40-41, 100; Fleck at 54, 56-58, 64-65; Gaddis 20-22, 30-31; Gleason at 66-67, 79; Gunn at 14-15, 17-18, 57-60; Hines at 16-18, 20-23, 30, 37-38; Horton at 18-20, 100-04; Johnson at 10-12, 4647; Kirkland at 59-62; Lambros at 24, 28; Legree at 16-17; Liphard at 29-33; Luttke at 22-23; MelonakisKurz at 47, 49-55; Miles at 60-61; Provost at 26, 35-36; Reynolds at 85, 87; Roberts at 30-33, 161, 186-87; Roddy at 15-17; Rodriguez at 54-55, 61; Rohrer at 48-52; Sandifer at 20-22 on 11/08/2005; Sweet at 34-35, 38; Thomas at 36-39, 56; Willaims at 51; Ziemack at 13-14. Plaintiffs in addition to be required to get final approval from underwriting, sometimes sought approval from their manager. Ex. 1 at 55-57. The parties agree that Plaintiffs have some ability to alter the interest rate or fees charged within a set range when selling the loan products. See Casas v. Conseco, 2002 WL 507059 (D. Minn. Mar. 31, 2002)(holding that negotiating pricing and adding closing points when selling the loan were all subject to set guidelines and did not constitute independent discretion and judgment contemplated by the regulations). Ex. 22. 21 Defendant's documents: Ex. 14 at ¶ 6. Plaintiffs' testimony at Ex. 23: Accetta at 17, 105; Agostini at 25; Alawan at 10-11; Berman at 18; Bias at 44-45; Clark at 114; Cousino at 16; DiBlasi at 15; Donahoo at 46; Fleck at 55, 62; Gaddis at 33; Gunn at 15-16; Hines at 32-33; Horton at 23, 29; Johnson at 12; Kirkland at 96; Lambros at 24; Liphard at 33, 75; Miles at 17-18; Provost at 29-30; Reynolds at 86-87; Rodriguez at 56-58; Rohrer at 46-47; Sandifer at 25, 36 on 11/08/2005; Schwiderson at 26; Sweet at 39-41; Williams at 52-59; Ziemack at 14-15. 22 Defendant's documents: Ex. 14 at ¶ 4. Plaintiffs' testimony: Accetta at 17-18, 105; Agostini at 25; Alawan at 12-13; Artis at 138; Berman at 18-19; Bias at 28-29; Clark at 83; DiBlasi at 15; Dinkel at 39, 64; Donahoo at 47; Fleck at 77-78; Gaddis at 33; Gleason at 82-83; Gunn at 14; Hines at 31, 38-41; Horton at 30, 98-99; Johnson at 52; Kirkland at 96; Lambros at 24; Liphard at 32-33, 75; Melonakis-Kurz at 8-11; Miles at 41; Roberts at 29; Rodriguez at 57; Rohrer at 46; Sandifer at 36-37 on 11/08/2005; Schwiderson at 23; Sweet at 37; Thomas at 57; Williams at 60; Ziemack at 14. 23 Prior to October 2001, Defendant permitted loan officers to send loans to lenders other than Defendant. Ex. 12 at 50-51; see generally Ex. 13. From October 2001 to 2002, Defendant only allowed loan officers to send loans to Defendant's bank or Interfirst Wholesale Mortgage Lending. Ex. 12 at 50-51; Ex. 13; see Ex. 10 at ¶ 4. Flynn testified that since at least 2002, Defendant has mandated that its loan officers always send

19

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h)

If approved by underwriting, the loan officer (or processor on occasion) schedules the closing with the title company and the loan officer will at times attend the closing to answer a question if one arises.25

Owner Flynn agrees that loan officers are similarly situated with respect to their job duties: Q: So we have been beating around the bush a little bit, or actually quite a bit, but as you probably know, one of the key questions in this case is: Are loan officers similarly situated nationwide, and what would your answer be to that? I don't understand what you mean by "situated." Do you believe that loan officers, nationwide, generally perform the same job duties? They perform--I would say that they perform similar job duties, yes.26

A: Q:

A:

In addition to loan officers performing similar job duties, they are also subject to strict sales and production goals.27 Defendant encourages production by all loan officers

loans through Defendant's bank first and then if rejected by Defendant, they were allowed to send it to another bank and Defendant would still receive a fee. Ex. 1 at 47-53, 61; Ex. 10; see Ex. 12 at 56. 24 Defendant's testimony and documents: Ex. 1 at 59; Ex. 14 at ¶ 6. Plaintiffs' testimony at Ex. 23: Accetta at 30-31, 98; Agostini at 25-26; Alawan at 14-15; Artis at 138; Berman at 19; Bias at 51; Clark at 93; Cousino at 16-17; Dary 12-13; DiBlasi at 15, 29-32; Dinkel at 30, 40-41, 62-63; Donahoo at 40, 10103; Fleck at 55, 61, 77-78; Gaddis at 19; Gleason at 53, 89; Gunn at 16; Horton at 15-16, 29; Johnson at 1213; Kirkland at 82; Lambros at 24-26; Legree at 15, 17; Liphard at 33-34; Luttke at 23-24; Melonakis-Kurz at 51-53; Miles at 18-19; Provost at 30; Reynolds at 88; Roberts at 29, 187; Roddy at 17; Rodriguez at 5758; Rohrer at 46-47; Sandifer at 38 on 11/08/2005; Schwiderson at 22, 26; Sweet 42; Thomas at 57; Williams at 59, 66; Ziemack at 14-15. 25 Defendant's testimony and documents: Ex. 14 at ¶ 6. Plaintiffs' testimony at Ex. 23: Accetta at 3233; Alawan at 43-44; Berman at 66-67; Bias at 24; Clark at 27; Dary at 13; DiBlasi at 34-36; Donahoo at 49; Fleck at 55, 79-80; Gaddis at 20; Gleason at 67-68; Gunn at 17; Hines at 42-44; Horton at 30; Johnson at 13; Kirkland at 97-98; Lambros at 27; Legree at 83-86; Liphard at 77; Luttke at 24-25; Melonakis-Kurz at 82-83, 87; Miles at 19-20; Provost at 31; Reynolds at 88; Roddy at 17; Rohrer at 81; Sweet at 46; Williams at 60-61; Ziemack at 15. 26 Ex. 1 at 63 (emphasis added). 27 Id.. at 7, 37-38, 41-42, 76.

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by comparing their sales to the sales of other loan officers nationwide.28 Defendant also requires that all loan officers hit certain minimum production goals or risk termination.29 When Plaintiffs began their employment with Defendant, they all learned of their job responsibilities through standardized orientation and training materials.30 They also received the same employee handbook and are subject to the same employee polices and procedures.31 Branch managers are required to follow those training materials issued by Defendant and are subject to discipline for not doing so.32 Defendant in its Motion to Decertify states generally that loan officers' job duties are different, but fails to meet its burden and give an explanation as to how they are different.33 Even if Defendant were to present some evidence as to differences in job duties, as mentioned previously, courts have held that it is appropriate for an FLSA action to proceed collectively with regard to employees who perform similar, but not identical duties. See Scott, 210 F.R.D. at 265 (allowing an FLSA action to proceed collectively for employees who perform similar, but not identical duties, notwithstanding the highly factspecific nature of the exemption inquiry.") 3. Plaintiffs are paid the same.

Id. at 70-72. Id. at 76; Ex. 16; Ex. 18. 30 Ex. 1 at 40-43. 31 Id. at 62-64. 32 Id. at 42-43. 33 See Defendant's Memorandum in Support of Motion for Decertification at p. 2. Defendant attempts to compare this case to Smith v. Heartland Automotive, 404 F.Supp.2d 1144 (D. Minn. 2005), which involved the executive, rather than administrative exemption. The Smith court explained that it was not a case where they could rely on a common job description as evidence that a collective action was appropriate since the plaintiffs were contesting the job description because it mainly set forth managerial tasks rather than the non-managerial tasks they claimed to have actually performed. Id. at 1151. On the contrary, Plaintiffs are not disputing Defendant's job description. Plaintiffs used Defendant's employment agreement, written description of job duties, testimony of Defendant's owner, and their own testimony as evidence of their job duties being similar.
29

28

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In addition to performing the same job duties, all loan officers are paid under the same compensation plan.34 The decision on how to pay loan officers was made by Defendant's executive management team, and branch managers have no authority to compensate loan officers differently.35 Prior to July 2002, Defendant did not pay loan officers a salary, and only paid them commissions on loans they closed.36 In response to audits by the Department of Labor, Defendant had to change the manner in which it compensated its loan officers.37 On July 31, 2002, it reclassified its loan officers as nonexempt overtime eligible employees, and required that they keep timesheets.38 Even so, Defendant never paid any loan officer any overtime pay.39 4. Plaintiffs worked overtime hours for which they were not paid.

As mentioned previously, 957 loan officers from 67 branch offices have signed up for this case because they worked overtime hours for which they were not paid. Plaintiffs have obtained Declarations from 315 Plaintiffs from 61 branch offices stating that they worked overtime hours for Defendant.40 In addition, the parties have taken the

depositions of 37 Plaintiffs who testified they worked overtime hours, and 10 of Defendant's branch sales managers who stated their loan officers either may have or did in fact work overtime hours.41 Plaintiffs also submitted over 5,000 timesheets from 32 branch offices in 10 states reflecting overtime hours for which loan officers were not
34 35

Ex. 1 at 63-66. Id. at 85. 36 Ex. 2 at 14-15. 37 Ex. 3 at 6-8. 38 Ex. 3 at 8-9; Ex.1 at 78; Ex. 2 at 11; Ex. 17. The timesheets were primarily kept to "increase [loan officers'] production." Ex. 1 at 86. 39 Ex. 1 at 78, 87; Ex. 2 at 12. 40 Ex. 21. Defendant disingenuously questions the veracity of these Declarations by accusing Plaintiffs' counsel of making inappropriate contacts with putative class members. Eric Jarold testified (intentionally omitted by Defendant in its citation to his testimony), that Plaintiffs' counsel only contacted him after he contacted them first asking for detailed information about the lawsuit, and contacted him again because he expressed uncertainty as to whether or not he was going to join the action. Ex. 7 at 59-61. 41 Exs. 19; 20.

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paid.42 Even so, Defendant admits that no loan officer has ever been paid overtime since it reclassified them as "non-exempt," overtime eligible employees.43 5. Defendant maintained a nationwide policy of not paying overtime.

Defendant also claims that this case should be decertified because "no national policy of FLSA non-compliance exists." Defendant asserts that this is simply a case where some rouge managers failed to follow the proper time sheet procedures, and therefore, the evidence fails to present a national policy of FLSA non-compliance. Rogue managers are not the issue here. This case involves a national policy by

Defendant, regardless of whether the timesheets showed overtime hours or not, of never paying any loan officer overtime compensation. For example, during the timeframe that Defendant used timesheets to record hours worked by its loan officers, all branch managers were required every pay period to fax the loan officers' timesheets to corporate payroll for processing.44 Owner Flynn was responsible for reviewing those timesheets.45 Although volumes of loan officer

timesheets submitted to Defendant's corporate offices show overtime hours worked, Defendant ignored these timesheets and never paid any overtime compensation to its loan officers.46 Additional evidence of a corporate policy of not paying overtime was obtained through testimony from members of Defendant's management team. They testified that Defendant informed them that loan officers would not be paid for their overtime hours
42

See Ex. 7 attached to Plaintiff's Memorandum in Support of Summary Judgment, filed on January 27, 2006. (Dkt. 331) Upon instruction by the Court, Plaintiffs did not file this voluminous exhibit again. See also Ex. 11 which contains documents reflecting that overtime hours were worked. 43 Ex. 1 at 78, 87; Ex. 2 at 12. 44 Ex. 1 at 83. 45 Ex. 4 at 9-10. 46 Ex. 1 at 78, 87; Ex. 2 at 12; Ex. 6 at 16-17.

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worked.47

When Plaintiffs complained to Defendant's management team about the

unlawful practices of not paying overtime or requiring them to falsify their timesheets,48 their managers responded by stating it was simply corporate policy.49 Moreover,

Defendant's managers testified that they were told by their superiors, including Flynn, that loan officers could only record forty hours per week on their timesheet even if they worked more.50 It is undisputed that regardless of whether branch managers allowed their loan officers to record overtime hours worked or not, Defendant's corporate office and payroll department never paid any loan officer overtime pay. Additional evidence of a nationwide policy of non-compliance with the FLSA is demonstrated by the fact that Defendant has been investigated several times by the Department of Labor. Between June 2002 and late 2004, the Department of Labor conducted three investigations into Defendant's overtime and minimum wage practices, and found it to be in violation of the FLSA.51 As mentioned previously, in June 2002, the Department of Labor found that Defendant's loan officers should have been classified as non-exempt.52 Rather than reviewing its records and overtime practices to ensure it was paying its loan officers properly, Defendant continued to violate they law by maintaining its corporate policy of never paying any loan officer for overtime hours worked.53 Defendant cites England v. New Century, 370 F.Supp.2d 504 (M.D. La. 2005) a case handled by Plaintiffs' firm, in support of its position that decertification is appropriate. However, New Century is distinguishable from the case at hand.
47 48

In the

Ex. 15. See Exs. 8; 9; 15. 49 Ex. 9. 50 See Ex. 15. 51 Ex. 3 at 6-8, 10-12; Ex. 1 at 88-107. 52 Ex. 3 at 5-6. 53 Ex. 5 at 10-11; Ex. 2 at 61.

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New Century case, some Plaintiffs were paid overtime compensation and others were not.54 Therefore, the Court believed there was insufficient evidence of a centralized policy not to pay overtime compensation. Id. at 506, 511. In the present case, Defendant has admitted to a centralized policy of never paying any loan officer anywhere, overtime compensation. As such, decertification is not appropriate. C. Defendant's Claimed Defenses.

For the reasons stated in Plaintiffs' motion for summary judgment Defendant's first claimed defense, the administrative exemption, is inapplicable to the entire group of Plaintiffs. As mentioned previously, the evidence shows that Plaintiffs were similarly situated with respect to their job duties and compensation and Defendant has failed to meet its burden of showing otherwise. As a result, decertification inappropriate. See generally Montoya v. Rescue Industries, Inc., 176 F.3d 489 (10th Cir. Colo. 1999)(reversing decertification, explaining that it was not the plaintiffs' burden to prove the affirmative defense that the plaintiffs' were exempt). Defendant also asserts additional defenses but does not meet its burden of explaining what exactly are the alleged differences between Plaintiffs relating to these defenses, how these defenses apply to this case, or how they defeat the similarly situated standard. The "suffer or permit" defense relates to differences in hours worked and damages and does not justify decertification.55 See Gold Strike Stamp Co. v. Christensen, 436 F2d 791, 796, 798 (10th Cir. 1970); see also Mendez v. Radec Corp., 232 F.R.D. 78, 92-93 (W.D. N.Y. 2005)(citing Blackie v. Barrack, 524 F.2d 891, 905 (9th Cir. 1975). Indeed, should differences in damages result in decertification, no FLSA overtime case

54 55

Fisher Aff. at ¶ 3. Defendant never asserted this defense previously and therefore waived it.

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could ever be certified for trial, defeating the clear intent of the statute. See 29 U.S.C. § 216(b). The defenses of "differing contract language," and "contractual choice provisions" are moot and do not warrant decertification.56 This case will not involve any relevant differing contractual language or any contractual interpretation because it is simply a failure to pay overtime compensation under the FLSA. Moreover, with respect to the contractual choice of law defense, although some of the employment agreements state that the agreement shall be construed in accordance with and governed by the laws of the state in which the loan officer worked,57 as already mentioned, this case does not involve any contractual issues and therefore differences in state law relating to contracts will not apply. Finally, Defendant raises the statute of limitations defense as being an impediment to certification for trial. However, the same statute of limitations will apply to all Plaintiffs, either a two or three year statute, depending on the Court's ruling on the issue of willfulness. See Moss, 201 F.R.D. at 411 (rejecting the argument that the statute of limitations defense warrants decertification). D. Fairness and Procedural Considerations Warrant Denying Decertification.

Based on the facts of this case and the purpose behind the FLSA, fairness and procedural considerations should result in the Court denying Defendant's motion for decertification. Defendant does not even address this factor, likely because decertification would result in chaos by requiring numerous courts across the country to try the identical case.
56 57

Defendant did not assert these defenses previously and therefore waived them. Ex. 10.

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Because of the substantial similarities in Plaintiffs' factual and employment settings, the notions of due process and fairness are not offended by a collective trial of Plaintiffs' claims. See Anderson v. Mt. Clemens Pottery Co., 328 U.S. 680 (1946) (holding that similarly situated plaintiffs may rely upon representative testimony to recover relief from an employer violating the FLSA). Further, decertifying this collective action would be contrary to the remedial purpose of the FLSA. A collective action affords plaintiffs "the advantage of lower individual costs to vindicate rights by pooling of resources." Hoffman-La Roche Inc. v. Sperling, 493 U.S. 165, 170, 110 S.Ct. 482 (1989); see Bradford, 184 F. Supp. 2d at 1351 ("As a practical matter. [sic] Plaintiffs can hardly be expected to pursue small claims individually, so there is little likelihood that their rights will be vindicated in the absence of a collective action.") Similarly, without the ability to pool their resources, it is highly unlikely that many of the Plaintiffs in this case will be able to afford the costs of pursuing their relatively small claims own their own. In fact, Plaintiffs' claims during the three year statute of limitations range from $38.63 to $57,951.70.58 Defendant's Memorandum lacks any reasonable solution or plan for the Court to follow should this matter be decertified. Decertifying this action will burden the federal court system across the country as opposed to resolving this case quickly in District of Colorado as one collective action. Decertification will affect U.S. District Courts in at least 31 different states and several different court districts within those states. Plaintiffs suggest the following plan to this Court. Plaintiffs believe that only the issue of damages will remain after the Court's ruling on summary judgment. If so, and if the parties are unable to resolve that issue on their own, alternative options exist such as
58

Fisher Aff. at ¶ 4 (exclusive of liquidated damages and attorneys' fees and costs).

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trying those damages claims to a magistrate judge or special master. See Mendez, 232 F.R.D. at 16-17. On the other hand, if issues of liability remain for trial, Plaintiffs propose trying this case using representative testimony. See Secretary of Labor v. DeSisto, 929 F.2d 789, 793 (1st Cir. 1991)(explaining that in FLSA collective actions, each plaintiff is not required to testify for all of the plaintiffs to meet their burden of proof, but rather, plaintiffs are entitled to present evidence through "representative" testimony); Mt. Clemens Pottery Co., 328 U.S. at 687 (explaining that how many employees are "representative" is not a question of statistical validity, but rather, the test is whether the evidence is sufficient to provide a "just and reasonable inference"). These proposals will make the most effective use of judicial resources. CONCLUSION Plaintiffs' plan to proceed as one uniform case through trial is more manageable than Defendant's plan for decertification. In light of the Congressional purpose of the FLSA, the fact that Plaintiffs are similarly situated, and in the interest of judicial economy, Plaintiffs request that Defendant's motion for decertification be denied. Dated: 02/20/06 NICHOLS KASTER & ANDERSON, PLLP s/Michele R. Fisher Donald H. Nichols, MN Bar No. 78918 Paul J. Lukas, MN Bar No. 22084X Michele R. Fisher, MN Bar No. 303069 Jill M. Novak, MN Bar No. 343456 4600 IDS Center, 80 S. 8th St. Minneapolis, MN 55402 Telephone (612) 256-3200 ATTORNEYS FOR PLAINTIFFS

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