Cari K. Dawson
Cari K. Dawson

With its recent ruling in Duran v. U.S. Bank Nat. Assn., the California Supreme Court has brought some much-needed clarity to in-house counsel grappling with class action lawsuits, according to Alston & Bird Partners Cari K. Dawson and Lisa H. Cassilly

In interviews with WIPL, they point to the similarities between that case and the U.S. Supreme Court ruling in Wal-Mart Stores, Inc. v. Dukes. Both decisions turn on the rights of defendants to present affirmative defenses and the limitations of trials using flawed statistical sampling models.

“This is very positive for companies, following the decision in the Wal-Mart case,” Dawson said. “California is a hot bed of class action litigation. Even if your company is located clear across the country, if you have customers in California, you may find yourself in California defending against class-action lawsuits.”

The ruling also goes beyond wage and hour misclassification lawsuits, she said. “The legal principles, holdings and findings have far-reaching implications for any type of class action.” 

NEXT: 3.5 key takeaways for in-house counsel

Dawson pointed to “3.5 takeaways” from the Duran decision that in-house counsel should be aware of:

1. The Duran ruling demonstrates that in California courts, there will be enhanced scrutiny of statistical sampling in determining classes, which is a positive development for defendants.

2. For in-house counsel, there should be an increased emphasis on the manageability of individual issues in trial plans. “I personally think it’s critically important that plaintiffs be required to file a trial plan, and corporate defendants be able to respond to it,” Dawson said.

3. Following the ruling, corporate defendants should have a heightened focus on the principles of due process.

3.5: Trial judges are often encouraged to demonstrate innovations and creativity to manage big class actions. The Duran case demonstrates that judges can’t be creative and innovative in such a way that they do not protect and respect substantive rights of both parties. 

“All three-and-a-half principles are explored and explained and analyzed quite beautifully in this decision, and they are important takeaways beyond wage and hour matters into any class action case,” she said. 

NEXT: The future of wage and hour class claims

Going forward, Dawson suggested that in-house counsel should understand the importance of developing an affirmative story and to focus on the facts as much as the law. “Sometimes, legal counsel get so focused on the legal arguments that they forget about factual arguments. U.S. Bank did an excellent job of developing its factual record,” she said.

Considering the role that statistical sampling played in the case, Dawson also suggested that in-house counsel develop relationships with experts before they need them, like the plaintiffs’ bar often does. “You need people in your stable that you can tap into,” she said.

According to Cassilly, the ruling offers a “play list” to announce new standards and approaches for taking on potential and certified class-action cases. 

“It’s an important decision to level the playing field a bit, to defend against certification premised upon vague standards which had been prevalent in California,” she said.

Duran won’t be the death knell for wage and hour class action cases,” she warned. “I don’t want to declare ‘Ding dong, the witch is dead.’ We are not going to see an immediate decline in number of wage and hour class claims which are filed. In fact, the plaintiffs’ bar may be declaring this a bit of a victory, since Duran declared that statistical sampling is appropriate in some cases. But it is much improved terrain for employers.”