Free Motion to Amend/Correct - District Court of Arizona - Arizona

IN THE UNITED STATES DISTRICT COURT FOR THE DISTRICT OF ARIZONA IN RE ALLSTATE INSURANCE COMPANY FAIR LABOR STANDARDS LITIGATION, ) ) ) ) ) ) ) ) ) ) ) ) ) )

MDL NO. 1541 CIV-04-15-PHX-PGR PLAINTIFFS' MOTION TO AMEND TO JOIN ADDITIONAL ADJUSTERS AS NAMED PLAINTIFFS TO THEIR FLSA ACTION

Leonard Gaglione, et al., Plaintiffs, -vsAllstate Insurance Company, et al., Defendant(s)

MOTION Now come the plaintiffs and do hereby move this court for an order permitting plaintiff to amend their complaint in order to add the four Allstate Claims Representatives as additional named Plaintiffs in the within action: 1) Deborah L. Smith; 2) Richard K. McCauliff; 3) Fitzroy H. DaSilva; 4) Chris Sweet. The grounds for this motion are set forth more fully below.

MEMORANDUM
A. The New Parties. Debbie Smith was an inside property claims representative for Allstate Insurance Company, and opted in the Gaglione FLSA suit on 10/10/02. Richard McCauliff was an

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Allstate Claims representative working in the unrepresented casualty unit, and opted in the Gaglione FLSA action on 04/09/05. Fitzroy DaSilva was an Allstate personal lines claims representative, and opted in the Gaglione FLSA suit on 01/07/03. Chris Sweet was an Allstate Auto claims representative, and opted in the Gaglione FLSA action personal lines on 11/10/04. B. Law and Argument. A motion to amend the complaint is governed by Fed. R. Civ. P. 15(a): (a) Amendments. A party may amend the party's pleading once as a matter of course at any time before a responsive pleading is served or, if the pleading is one to which no responsive pleading is permitted and the action has not been placed upon the trial calendar, the party may so amend it at any time within 20 days after it is served. Otherwise a party may amend the party's pleading only be leave of court or by written consent of the adverse party; and leave shall be freely given when justice so requires. A party shall plead in response to an amended pleading within the time remaining for response to the original pleading or within 10 days after service of the amended pleading, whichever period may be the longer, unless the court otherwise orders. Rule 15(a) embodies a liberal policy of permitting amendment. Leave to amend should be freely given unless the amendment is sought for the purpose of creating delay, to cure deficiencies in previously allowed amendments, or its granting will unduly prejudice the opposing party. Forman v. Davis, 371 U.S. 178, 182, 9 L. Ed. 222, 83 S. Ct. 227 (1962). Here, the amendment is sought for the purpose of adding new named plaintiffs. Their addition to the lawsuit will not cause delay. They are already opt-in plaintiffs whose right to recovery has yet to be determined. Having that determination made while they are named plaintiffs as opposed to opt-in plaintiffs, will not delay a ruling as to whether or not they have a right to recovery.

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Plaintiffs are not seeking an amendment to cure deficiencies in previously allowed amendments. Plaintiffs have not previously sought leave to amend. Moreover, the amendment is not intended to cure deficiencies. Rather, permitting these claims representatives to become named plaintiffs will assist the court. All have slightly different positions than the presently named plaintiffs. An examination of their duties and work experiences will lead to a more thorough understanding of the extent to which other classes of claims representatives have had their discretion and independent judgment restricted by the defendants' implementation of the CCPR management structure. Given that this is a representative action, their inclusion in the suit will assist the court in assuring that the named plaintiffs are "similarly situated" to putative class members. 29 U.S.C. §216(b). An amendment of the complaint will not unduly prejudice the defendant. First, this is not a situation where plaintiffs have sought an amendment to alter their theory of liability, long after the discovery has passed. In such cases, an opposing party could suffer prejudice. However, Allstate's position is that none of its policies, including CCPR, restrict a claims representative's independent judgment and discretion to the point that the administrative exemption set forth in 29 C.F.R. §541.2. The evidence on which it relies for this theory is comprised mostly of the affidavits of its middle and upper level managers and the personnel files of its claim representatives. All of this information is already in Allstate's possession. At most, Allstate would have to take four additional depositions of four additional plaintiffs. This could hardly rise to the level of "undue prejudice."

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Joining additional plaintiffs is also favored under Fed. R. Civ. P. 20. That rule provides in pertinent part: (a) Permissive Joinder. All persons may join in one action as plaintiffs if they assert any right to relief jointly, severally, or in the alternative in respect of or arising out of the same transaction, occurrence, or series of transactions or occurrences and if any question of law or fact common to all these persons will arise in the action. Permissive joinder is to be construed liberally in order to promote trial convenience and efficiency, and to prevent inconsistent outcomes. League To Save Lake Tahoe et al., v. Tahoe Regional Planning Agency et al., 558 F.2d 914 (9th Cir. 1977). Although the grant or denial of a motion to amend is discretionary, the underlying policies of permissive joinder under Rule 20 weigh in favor of granting a motion to amend for the purpose of adding new parties. Desert Empire Bank v. Insurance Co. of N.Am., 623 F.2d 1371, 1375 (9th Cir. 1980). Fed. R. Civ. P. 20(a) imposes two specific requisites for the joinder of parties: (1) a right to relief must be asserted by, or against, each plaintiff or defendant relating to or arising out of the same transaction or occurrence; and (2) some question of law or fact common to all the parties will arise in the action. League To Save Lake Tahoe Supra. The claims of the current named plaintiffs and of the four claims representatives plaintiffs seek to add by amendment, arise out of Allstate's misclassification of its Claims Representatives as administrative employees under the FLSA. Furthermore, there are many questions of law and fact in common to all parties involved in this action, such as the application of the administrative production dichotomy under the pertinent FLSA regulations, and the effect of Allstate's "operational straight jacket" CCPR system on all

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the Allstate adjusters' independent judgment and discretion in the performance of their duties. With the addition of the aforementioned four Allstate claims representatives, a more complete factual record can be developed in the litigation of this case, thereby contributing to the expeditious final determination of the disputes in this case, in accordance with Civ. Rule 20's goals. Finally, joinder in this case is consistent with fairness to the parties. CONCLUSION For the reasons set forth herein, plaintiffs respectfully request that: 1) Deborah L. Smith; 2) Richard k. McCauliff; 3) Fitzroy H. DaSilva; and 4) Chris Sweet be permitted to join as named plaintiffs in the FLSA action being pursued by plaintiff Leonard Gaglione, Michael Aiken and Maxine Slappy.

Respectfully submitted, /s/ Steven M. Weiss STEVEN M. WEISS (0028984) Law Offices of Steven M. Weiss 55 Public Square, Suite 1009 Cleveland, Ohio 44113 Telephone: (216) 348-1800 Facsimile: (216) 348-1130 [email protected] /s/ George Sintsirmas GEORGE SINTSIRMAS (0032771) 6212 Coldstream Road Highland Heights, Ohio 44143 Telephone: (440) 446-1529 Facsimile: (440) 446-1530 [email protected] Attorney for Plaintiffs

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CERTIFICATE OF SERVICE A copy of the foregoing was sent electronically this 13th day of February, 2006 to: Joel E. Krischer, Esq. Attorney for Defendants [email protected] Latham & Watkins, LLP 633 West Fifth Street, Suite 4000 Los Angeles, CA 90071-2007 Andrew M. Paley, Esq. [email protected] One Century Plaza, Suite 3300 2029 Century Park East Los Angeles, CA 90067 Donald A. Wall, Esq. [email protected] Squire, Sanders & Dempsey, LLP 4900 Key Tower 127 Public Square Cleveland, Ohio 44114-1304 Kelly McInerney, Esq. [email protected] 18124 Wedge Parkway, Suite 503 Reno, Nevada 89511 Andrea Watters, Esq. [email protected] Watters & Watters, PC 2807 East Broadway Blvd. Tucson, Arizona 85716 James Jones, Esq. [email protected] Gillespie, Rozen, Watsky, Motley & Jones 3402 Oak Grove Avenue, #200 Dallas, TX 75204

/s/ Steven M. Weiss STEVEN M. WEISS (0028984)

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