Recent Eastern District of Pennsylvania Decision Addresses Some Thorny FLSA Procedural Issues

On July 1, 2010, Judge Mary A. McLaughlin of the Eastern District of Pennsylvania issued a decision in Bambgose v. Delta-T Group, Inc., 2010 U.S. Dist. LEXIS 65586. The case involved helathcare workers who alleged that the company misclassified them as independent contractors and illegally refused to pay them overtime. In a previous opinion, the court refused to conditionally certify the FLSA class, but the conditional certification motion was merely denied without prejudice to plaintiff renewing the motion after taking some discovery and narrowing the class definition. At the time the court denied the conditional certification motion, over 50 workers already had opted-in to the lawsuit, and a few more opted-in after the decertification denial. Against this backdrop, the company moved to diamiss all opt-ins for lack of jurisdiction. According to the company, the opt-ins were dismissed from the case when the court denied the conditional certification motion. The court disagreed and held that denial of a conditional certification motion without prejudice does not result in the dismissal of opt-in’s right to remain in the lawsuit. The court explained that the opt-ins’ claims would be dismissed (without prejudice) only under two scenarios: (i) where a conditional certification motion is denied with finality or (ii) the a decertification motion is granted. Next, the court addressed the impact of the originating plaintiff’s acceptance of a Rule 68 offer made by the company in the wake of the court’s conditional certification decision. The court held that the collective action could proceed regardless of the Rule 68 offer, and, in so holding, included an excellent survey of the relevant caselaw.

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