Espenscheid v. DirectSat USA LLC

The requirement that the named plaintiff must be an adequate class representative is not often the basis for denying class certification. But a recent decision from the Northern District of Illinois in a false-advertising class action illustrates the importance of taking discovery on facts that are relevant to the adequacy standard.

In Lipton v. Chattem, Inc., the district court denied class certification in a case alleging that purchasers of a weight-loss product, Dexatrim, had been deceived because the label did not disclose that its ingredients included hexavalent chromium, which allegedly can cause serious health problems. The court held that
Continue Reading Lipton v. Chattem, Inc.: Federal District Court Denies Certification On Adequacy Grounds

The Seventh Circuit’s recent decision in Espenscheid v. DirectSat USA, LLCauthored by Judge Posner—is full of good news for employers and other class-action defendants.

The case is a hybrid collective action under the Fair Labor Standards Act (pdf) and opt-out Rule 23(b)(3) class action asserting state-law wage-and-hour claims. The plaintiffs—a group of home satellite-dish installers who were paid by the job rather than by the hour—sued their employer for allegedly failing to ensure that they were paid the federal minimum wage and time-and-a-half for overtime work. The district court initially certified the collective and class actions, but decertified
Continue Reading Seventh Circuit: A “Shapeless, Free-Wheeling” Trial Plan Is Grounds for Decertifying Class