Massachusetts Federal Judge: Domino’s Driver Class Actions Can Proceed

Mealey's (August 2, 2016, 12:37 PM EDT) -- BOSTON — A Massachusetts federal judge on July 29 allowed two separate but related putative class actions filed on behalf of Domino’s pizza delivery drivers against their Domino’s franchise employers to proceed, although limited to one class that signed an arbitration agreement and one class that did not (Atila Adolfo Tigges, et al. v. AM Pizza Inc., et al., No. 1:16-cv-10136, and Tylor Reeves, et al. v. PMLRA Pizza, et al., No. 1:16-cv-10474, D. Mass.; 2016 U.S. Dist. LEXIS 100366). (Opinion available. Document #98-160809-032Z.) One class action was filed by Atila Adolfo Tigges against his former employers, AM Pizza Inc. and Henry Askew. The other was filed by Tylor Reeves against his former employers, PMLRA Pizza Inc. and Askew, who is president of both Domino’s franchise employers. U.S. Judge William G. Young of the District of Massachusetts described the cases as “the most recent expression of a long-standing dispute between certain Domino’s pizza delivery drivers and their Domino’s franchise employers” and said both cases have “a lot of overlap.” Tigges and Reeves are former pizza delivery drivers, their complaints are based on the same statutory violations and they are represented by the same attorneys. Both AM and PMLRA are Domino’s franchisees that share the same president, Askew, and operate multiple Domino’s locations in Massachusetts that have employed hundreds of delivery drivers. ‘Delivery Charge’ The two complaints allege that the “delivery charge” imposed on the defendants’ customers was in fact a “service charge” that the defendants failed to pay to their delivery drivers in violation of Massachusetts General Laws Chapters 149 (the Tips Act) and 151 (the Minimum Wage Act). Judge Young held a single status conference for both actions on May 23 to consider Tigges and Reeves’ motions for class certification and the defendants’ motion to dismiss. Judge Young granted Tigges’ motion for certification of the class of delivery drivers employed by AM who had not signed arbitration agreements and Reeves’ motion for certification of a class of delivery drivers employed by PMLRA who had signed arbitration agreements. The judge denied the defendants’ motions to dismiss. AM employed Tigges as a delivery driver between 2008 and 2013. Reeves was a delivery driver employed by PMLRA between 2014 and 2015. PMLRA presented some of its employees, including Reeves, with a contract under which the employees would have to bring any action against their employer through individual arbitration unless they exercised their right to opt out of the agreement. Tigges on Nov. 13 sued in the Middlesex County Superior Court. Reeves filed in the same court on Jan. 7. Both complaints allege two counts, brought pursuant to Section 150 of the Tips Act and Section 20 of the Minimum Wage Act. Both cases were removed to federal court. Classes Tigges sought to certify a class of “all individuals who worked as delivery drivers for [AM] at any time [since] August 12, 2012.” Reeves requested class certification for all individuals employed as delivery drivers by PMLRA at any time since Dec. 31, 2010. In their motions opposing certification of the classes, the AM and PMLRA defendants challenged only the Federal Rule of Civil Procedure 23(a)(2) commonality and 23(a)(3) typicality requirements. “In general, where ‘implementation of [a] common scheme is alleged, the commonality requirement usually is satisfied,’” the judge wrote, citing Overka v. Am. Airlines, Inc. (265 F.R.D. at 18 [D. Mass. 2010]). “The Plaintiffs allege such common schemes in both of the instant cases, arguing that common answers to the following common questions drive the litigation: whether the Defendants violated Massachusetts law by paying the delivery drivers a tipped minimum wage without notification, whether the delivery charge is in fact a ‘service charge’ within the meaning of the Tips Act, whether the Defendants can rely on the safe harbor provision of the Tips Act, whether the gas mileage reimbursement paid to drivers was paid from the delivery charge, and how damages ought to be calculated. . . . “There is one common question central to all the Plaintiffs’ Claims — whether the Defendants have violated Massachusetts law by not distributing the ‘delivery charge’ to the delivery drivers.” Typicality Judge Young also found the typicality requirement met. “In the instant cases, the named Plaintiffs, Tigges and Reeves, and the unnamed Plaintiffs are all former or present pizza delivery drivers for one of the Defendants, seeking compensation for unpaid service charges arising from their employers’ practice of charging their customers a delivery charge,” the judge wrote. Judge Young said AM could not articulate why Tigges’ being employed for a slightly different time period than other class members would create a conflict of interests or skew Tigges’ incentives away from those he represents, the other class members who challenge the same policies and practices. Although the defendants in the Reeves case argued that the binding arbitration agreement Reeves signed precluded him from bringing a class action, Judge Young ruled that the class action waiver in the arbitration agreement signed by Reeves and other employees was unenforceable because a collective action is “the very essence of labor rights” granted to employees under the National Labor Relations Act. Class Limits The plaintiffs’ class counsel suggested that since the arbitration agreement’s class action waiver provision is invalid, Judge Young should expand the presently limited classes so that Tigges (no arbitration agreement) and Reeves (arbitration agreement) can represent all drivers and former drivers for their respective employers within the applicable statutes of limitations. “The Court demurs. While confident of its reasoning, there is a circuit split as to an employers’ ability to include class action waivers in employment contracts,” Judge Young wrote. “The First Circuit has not yet weighed in. In such circumstances, it is the better part of valor to leave the delimited classes as they are. . . . “Since the claims of Tigges and Reeves must be ‘typical’ of the class they seek to represent, it makes sense to limit Tigges’s class to non-signatories and Reeves’ class to signatories.” Tigges and Reeves are represented by Stephen S. Churchill and Brant Casavant of Fair Work P.C. in Boston. PMLRA, AM and Askew are represented by Eric R. LeBlanc of Bennett & Belfort in Cambridge, Mass. (Additional documents available.  Tigges motion to certify.  Document #98-160809-033M.  Reeves motion to certify.  Document #98-160809-034M.  Defense motion to dismiss.  Document #98-160809-035M.)...